BEST BUY CO INC (BBY)
US0865161014 - Common Stock
Taking everything into account, BBY scores 6 out of 10 in our fundamental rating. BBY was compared to 121 industry peers in the Specialty Retail industry. BBY scores excellent on profitability, but there are some minor concerns on its financial health. BBY is not valued too expensively and it also shows a decent growth rate. BBY also has an excellent dividend rating. This makes BBY very considerable for dividend investing!
1. Profitability
1.1 Basic Checks
In the past year BBY was profitable.
BBY had a positive operating cash flow in the past year.
BBY had positive earnings in each of the past 5 years.
Each year in the past 5 years BBY had a positive operating cash flow.
1.2 Ratios
The Return On Assets of BBY (7.46%) is better than 79.17% of its industry peers.
Looking at the Return On Equity, with a value of 41.21%, BBY belongs to the top of the industry, outperforming 91.67% of the companies in the same industry.
BBY has a better Return On Invested Capital (19.60%) than 87.50% 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 12.29%.
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.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.46% | ||
| ROE | 41.21% | ||
| ROIC | 19.6% |
ROA(3y)10.43%
ROA(5y)10.12%
ROE(3y)57.56%
ROE(5y)51.23%
ROIC(3y)25.19%
ROIC(5y)24.01%
1.3 Margins
The Profit Margin of BBY (3.01%) is better than 67.50% of its industry peers.
BBY's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 4.21%, BBY is in line with its industry, outperforming 60.00% of the companies in the same industry.
In the last couple of years the Operating Margin of BBY has declined.
BBY's Gross Margin of 22.42% is on the low side compared to the rest of the industry. BBY is outperformed by 78.33% of its industry peers.
BBY's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.21% | ||
| PM (TTM) | 3.01% | ||
| GM | 22.42% |
OM growth 3Y-10.12%
OM growth 5Y-2.87%
PM growth 3Y-9.11%
PM growth 5Y-3.51%
GM growth 3Y-0.48%
GM growth 5Y-0.99%
2. Health
2.1 Basic Checks
BBY has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for BBY has been reduced compared to 1 year ago.
The number of shares outstanding for BBY has been reduced compared to 5 years ago.
The debt/assets ratio for BBY is higher compared to a year ago.
2.2 Solvency
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 82.50% of its industry peers.
A Debt/Equity ratio of 0.37 indicates that BBY is not too dependend on debt financing.
BBY has a Debt to Equity ratio (0.37) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.37 | ||
| Debt/FCF | 1.12 | ||
| Altman-Z | N/A |
ROIC/WACC1.95
WACC10.07%
2.3 Liquidity
A Current Ratio of 1.00 indicates that BBY should not have too much problems paying its short term obligations.
BBY has a worse Current ratio (1.00) than 74.17% of its industry peers.
A Quick Ratio of 0.22 indicates that BBY may have some problems paying its short term obligations.
BBY's Quick ratio of 0.22 is on the low side compared to the rest of the industry. BBY is outperformed by 84.17% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1 | ||
| Quick Ratio | 0.22 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 3.99% over the past year.
The Earnings Per Share has been growing slightly by 3.47% on average over the past years.
BBY shows a decrease in Revenue. In the last year, the revenue decreased by -3.02%.
The Revenue has been growing slightly by 0.27% on average over the past years.
EPS 1Y (TTM)3.99%
EPS 3Y-6.95%
EPS 5Y3.47%
EPS Q2Q%-2.33%
Revenue 1Y (TTM)-3.02%
Revenue growth 3Y-2.76%
Revenue growth 5Y0.27%
Sales Q2Q%-3.19%
3.2 Future
BBY is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 14.46% yearly.
Based on estimates for the next years, BBY will show a small growth in Revenue. The Revenue will grow by 0.96% on average per year.
EPS Next Y-2.2%
EPS Next 2Y2.19%
EPS Next 3Y5.35%
EPS Next 5Y14.46%
Revenue Next Year-4.88%
Revenue Next 2Y-1.77%
Revenue Next 3Y-0.23%
Revenue Next 5Y0.96%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 13.57 indicates a correct valuation of BBY.
80.83% of the companies in the same industry are more expensive than BBY, based on the Price/Earnings ratio.
BBY is valuated cheaply when we compare the Price/Earnings ratio to 27.54, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 13.28, the valuation of BBY can be described as correct.
Compared to the rest of the industry, the Price/Forward Earnings ratio of BBY indicates a somewhat cheap valuation: BBY is cheaper than 74.17% of the companies listed in the same industry.
BBY is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 23.99, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.57 | ||
| Fwd PE | 13.28 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, BBY is valued a bit cheaper than the industry average as 79.17% of the companies are valued more expensively.
BBY's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. BBY is cheaper than 75.83% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.37 | ||
| EV/EBITDA | 7.2 |
4.3 Compensation for Growth
The decent profitability rating of BBY may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)3.91
EPS Next 2Y2.19%
EPS Next 3Y5.35%
5. Dividend
5.1 Amount
BBY has a Yearly Dividend Yield of 4.41%, which is a nice return.
Compared to an average industry Dividend Yield of 3.46, BBY pays a better dividend. On top of this BBY pays more dividend than 91.67% 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 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.41% |
5.2 History
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 its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)15.34%
Div Incr Years13
Div Non Decr Years13
5.3 Sustainability
BBY pays out 63.39% of its income as dividend. This is not a sustainable payout ratio.
BBY's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP63.39%
EPS Next 2Y2.19%
EPS Next 3Y5.35%
BEST BUY CO INC
NYSE:BBY (12/26/2024, 12:07:07 PM)
88.5
+1.65 (+1.9%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners85.91%
Inst Owner Change1.53%
Ins Owners0.29%
Ins Owner Change-2.75%
Market Cap18.92B
Analysts70.3
Price Target102.23 (15.51%)
Short Float %5.9%
Short Ratio3.69
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.41% |
Dividend Growth(5Y)15.34%
DP63.39%
Div Incr Years13
Div Non Decr Years13
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)5.52%
Min EPS beat(2)-3.62%
Max EPS beat(2)14.65%
EPS beat(4)3
Avg EPS beat(4)7.07%
Min EPS beat(4)-3.62%
Max EPS beat(4)14.65%
EPS beat(8)7
Avg EPS beat(8)9.37%
EPS beat(12)9
Avg EPS beat(12)10.28%
EPS beat(16)12
Avg EPS beat(16)15.57%
Revenue beat(2)0
Avg Revenue beat(2)-1.73%
Min Revenue beat(2)-2.93%
Max Revenue beat(2)-0.52%
Revenue beat(4)0
Avg Revenue beat(4)-1.51%
Min Revenue beat(4)-2.93%
Max Revenue beat(4)-0.39%
Revenue beat(8)0
Avg Revenue beat(8)-1.4%
Revenue beat(12)2
Avg Revenue beat(12)-0.89%
Revenue beat(16)5
Avg Revenue beat(16)0.05%
PT rev (1m)-3.86%
PT rev (3m)11.61%
EPS NQ rev (1m)-2.55%
EPS NQ rev (3m)-2.55%
EPS NY rev (1m)-1.21%
EPS NY rev (3m)-1.02%
Revenue NQ rev (1m)-2.59%
Revenue NQ rev (3m)-2.59%
Revenue NY rev (1m)-0.8%
Revenue NY rev (3m)-0.86%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.57 | ||
| Fwd PE | 13.28 | ||
| P/S | 0.45 | ||
| P/FCF | 18.37 | ||
| P/OCF | 10.87 | ||
| P/B | 6.14 | ||
| P/tB | 11.14 | ||
| EV/EBITDA | 7.2 |
EPS(TTM)6.52
EY7.37%
EPS(NY)6.66
Fwd EY7.53%
FCF(TTM)4.82
FCFY5.44%
OCF(TTM)8.14
OCFY9.2%
SpS197.5
BVpS14.42
TBVpS7.95
PEG (NY)N/A
PEG (5Y)3.91
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.46% | ||
| ROE | 41.21% | ||
| ROCE | 25.16% | ||
| ROIC | 19.6% | ||
| ROICexc | 21.56% | ||
| ROICexgc | 27.48% | ||
| OM | 4.21% | ||
| PM (TTM) | 3.01% | ||
| GM | 22.42% | ||
| FCFM | 2.44% |
ROA(3y)10.43%
ROA(5y)10.12%
ROE(3y)57.56%
ROE(5y)51.23%
ROIC(3y)25.19%
ROIC(5y)24.01%
ROICexc(3y)38.26%
ROICexc(5y)41.73%
ROICexgc(3y)60.85%
ROICexgc(5y)66.12%
ROCE(3y)32.34%
ROCE(5y)30.9%
ROICexcg growth 3Y-32.67%
ROICexcg growth 5Y-11.96%
ROICexc growth 3Y-27.81%
ROICexc growth 5Y-11.85%
OM growth 3Y-10.12%
OM growth 5Y-2.87%
PM growth 3Y-9.11%
PM growth 5Y-3.51%
GM growth 3Y-0.48%
GM growth 5Y-0.99%
F-Score6
Asset Turnover2.48
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.37 | ||
| Debt/FCF | 1.12 | ||
| Debt/EBITDA | 0.43 | ||
| Cap/Depr | 81.63% | ||
| Cap/Sales | 1.68% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 65.7% | ||
| Profit Quality | 81.1% | ||
| Current Ratio | 1 | ||
| Quick Ratio | 0.22 | ||
| Altman-Z | N/A |
F-Score6
WACC10.07%
ROIC/WACC1.95
Cap/Depr(3y)90.75%
Cap/Depr(5y)89.75%
Cap/Sales(3y)1.75%
Cap/Sales(5y)1.69%
Profit Quality(3y)73.29%
Profit Quality(5y)114.5%
High Growth Momentum
Growth
EPS 1Y (TTM)3.99%
EPS 3Y-6.95%
EPS 5Y3.47%
EPS Q2Q%-2.33%
EPS Next Y-2.2%
EPS Next 2Y2.19%
EPS Next 3Y5.35%
EPS Next 5Y14.46%
Revenue 1Y (TTM)-3.02%
Revenue growth 3Y-2.76%
Revenue growth 5Y0.27%
Sales Q2Q%-3.19%
Revenue Next Year-4.88%
Revenue Next 2Y-1.77%
Revenue Next 3Y-0.23%
Revenue Next 5Y0.96%
EBIT growth 1Y5.89%
EBIT growth 3Y-12.6%
EBIT growth 5Y-2.61%
EBIT Next Year49.49%
EBIT Next 3Y17.7%
EBIT Next 5Y11.24%
FCF growth 1Y-14.02%
FCF growth 3Y-45.69%
FCF growth 5Y-15.74%
OCF growth 1Y-16.42%
OCF growth 3Y-33.18%
OCF growth 5Y-9.4%