Is NYSE:BBY suited for dividend investing?

Last update: Dec 9, 2024

BEST BUY CO INC (NYSE:BBY) is a hidden gem unveiled by our stock screening tool, featuring a promising dividend outlook alongside solid fundamentals. NYSE:BBY demonstrates decent financial health and profitability while ensuring a sustainable dividend. Let's break it down further.

Analyzing Dividend Metrics

To gauge a stock's dividend quality, ChartMill utilizes a Dividend Rating ranging from 0 to 10. This comprehensive assessment considers various dividend aspects, including yield, history, growth, and sustainability. NYSE:BBY has achieved a 8 out of 10:

With a Yearly Dividend Yield of 4.19%, BBY is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 3.39, BBY pays a better dividend. On top of this BBY pays more dividend than 92.56% of the companies listed in the same industry.
BBY's Dividend Yield is rather good when compared to the S&P500 average which is at 2.20.
On average, the dividend of BBY grows each year by 15.34%, which is quite nice.
BBY has paid a dividend for at least 10 years, which is a reliable track record.
BBY has not decreased their dividend for at least 10 years, which is a reliable track record.

Understanding NYSE:BBY's Health

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NYSE:BBY has received a 5 out of 10:

The Debt to FCF ratio of BBY is 1.12, which is an excellent value as it means it would take BBY, only 1.12 years of fcf income to pay off all of its debts.
BBY has a better Debt to FCF ratio (1.12) than 80.99% of its industry peers.
BBY has a Debt/Equity ratio of 0.37. This is a healthy value indicating a solid balance between debt and equity.

Profitability Insights: NYSE:BBY

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NYSE:BBY scores a 7 out of 10:

BBY has a Return On Assets of 7.46%. This is in the better half of the industry: BBY outperforms 79.34% of its industry peers.
BBY has a better Return On Equity (41.21%) than 90.08% of its industry peers.
BBY has a Return On Invested Capital of 19.60%. This is amongst the best in the industry. BBY outperforms 87.60% of its industry peers.
BBY had an Average Return On Invested Capital over the past 3 years of 25.19%. This is significantly above the industry average of 12.04%.
The last Return On Invested Capital (19.60%) for BBY is well below the 3 year average (25.19%), which needs to be investigated, but indicates that BBY had better years and this may not be a problem.
BBY has a Profit Margin of 3.01%. This is in the better half of the industry: BBY outperforms 67.77% of its industry peers.
BBY's Operating Margin of 4.21% is fine compared to the rest of the industry. BBY outperforms 61.16% of its industry peers.

Every day, new Best Dividend stocks can be found on ChartMill in our Best Dividend screener.

For an up to date full fundamental analysis you can check the fundamental report of BBY

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.