BEST BUY CO INC (BBY) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:BBY - US0865161014 - Common Stock
67.84 USD
-1.77 (-2.54%)
67.87 USD
+0.03 (+0.04%)
Overall BBY gets a fundamental rating of 5 out of 10. We evaluated BBY against 123 industry peers in the Specialty Retail industry. Both the profitability and the financial health of BBY get a neutral evaluation. Nothing too spectacular is happening here. BBY is valued quite cheap, but it does not seem to be growing. Finally BBY also has an excellent dividend rating. These ratings could make BBY a good candidate for value and dividend investing.
1. Profitability
1.1 Basic Checks
BBY had positive earnings in the past year.
In the past year BBY had a positive cash flow from operations.
In the past 5 years BBY has always been profitable.
Each year in the past 5 years BBY had a positive operating cash flow.
1.2 Ratios
BBY has a Return On Assets of 3.84%. This is in the better half of the industry: BBY outperforms 63.41% of its industry peers.
With an excellent Return On Equity value of 24.31%, BBY belongs to the best of the industry, outperforming 82.93% of the companies in the same industry.
With an excellent Return On Invested Capital value of 19.29%, BBY belongs to the best of the industry, outperforming 87.80% of the companies in the same industry.
BBY had an Average Return On Invested Capital over the past 3 years of 19.35%. This is significantly above the industry average of 12.14%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.84% | ||
| ROE | 24.31% | ||
| ROIC | 19.29% |
ROA(3y)7.85%
ROA(5y)9.4%
ROE(3y)41.48%
ROE(5y)48.98%
ROIC(3y)19.35%
ROIC(5y)22.54%
1.3 Margins
The Profit Margin of BBY (1.54%) is comparable to the rest of the industry.
BBY's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 4.16%, BBY is in the better half of the industry, outperforming 60.98% of the companies in the same industry.
In the last couple of years the Operating Margin of BBY has declined.
With a Gross Margin value of 22.50%, BBY is not doing good in the industry: 78.05% of the companies in the same industry are doing better.
BBY's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.16% | ||
| PM (TTM) | 1.54% | ||
| GM | 22.5% |
OM growth 3Y-10.46%
OM growth 5Y-2.33%
PM growth 3Y-22.2%
PM growth 5Y-8.77%
GM growth 3Y0.15%
GM growth 5Y-0.37%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), BBY is creating value.
BBY has less shares outstanding than it did 1 year ago.
BBY has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, BBY has a worse debt to assets ratio.
2.2 Solvency
The Debt to FCF ratio of BBY is 0.77, which is an excellent value as it means it would take BBY, only 0.77 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of BBY (0.77) is better than 81.30% of its industry peers.
A Debt/Equity ratio of 0.44 indicates that BBY is not too dependend on debt financing.
BBY has a Debt to Equity ratio of 0.44. This is comparable to the rest of the industry: BBY outperforms 55.28% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.44 | ||
| Debt/FCF | 0.77 | ||
| Altman-Z | N/A |
ROIC/WACC2.05
WACC9.41%
2.3 Liquidity
A Current Ratio of 1.05 indicates that BBY should not have too much problems paying its short term obligations.
BBY has a Current ratio of 1.05. This is in the lower half of the industry: BBY underperforms 73.17% of its industry peers.
BBY has a Quick Ratio of 1.05. This is a bad value and indicates that BBY is not financially healthy enough and could expect problems in meeting its short term obligations.
BBY has a Quick ratio of 0.26. This is amonst the worse of the industry: BBY underperforms 84.55% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.05 | ||
| Quick Ratio | 0.26 |
3. Growth
3.1 Past
BBY shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -1.69%.
The Earnings Per Share has been growing slightly by 0.80% on average over the past years.
BBY shows a decrease in Revenue. In the last year, the revenue decreased by -0.95%.
BBY shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -0.99% yearly.
EPS 1Y (TTM)-1.69%
EPS 3Y-13.97%
EPS 5Y0.8%
EPS Q2Q%11.11%
Revenue 1Y (TTM)-0.95%
Revenue growth 3Y-7.08%
Revenue growth 5Y-0.99%
Sales Q2Q%2.4%
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 9.76% yearly.
Based on estimates for the next years, BBY will show a small growth in Revenue. The Revenue will grow by 2.13% on average per year.
EPS Next Y0.1%
EPS Next 2Y3.28%
EPS Next 3Y5.26%
EPS Next 5Y9.76%
Revenue Next Year1.41%
Revenue Next 2Y1.39%
Revenue Next 3Y1.56%
Revenue Next 5Y2.13%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 10.58, which indicates a very decent valuation of BBY.
Based on the Price/Earnings ratio, BBY is valued cheaper than 85.37% of the companies in the same industry.
When comparing the Price/Earnings ratio of BBY to the average of the S&P500 Index (26.84), we can say BBY is valued rather cheaply.
A Price/Forward Earnings ratio of 9.97 indicates a reasonable valuation of BBY.
Based on the Price/Forward Earnings ratio, BBY is valued cheaper than 85.37% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 23.40. BBY is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.58 | ||
| Fwd PE | 9.97 |
4.2 Price Multiples
82.11% of the companies in the same industry are more expensive than BBY, based on the Enterprise Value to EBITDA ratio.
87.80% of the companies in the same industry are more expensive than BBY, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.41 | ||
| EV/EBITDA | 5.75 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates BBY does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of BBY may justify a higher PE ratio.
PEG (NY)101.94
PEG (5Y)13.19
EPS Next 2Y3.28%
EPS Next 3Y5.26%
5. Dividend
5.1 Amount
BBY has a Yearly Dividend Yield of 5.45%, which is a nice return.
Compared to an average industry Dividend Yield of 2.01, BBY pays a better dividend. On top of this BBY pays more dividend than 92.68% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.00, BBY pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.45% |
5.2 History
The dividend of BBY is nicely growing with an annual growth rate of 13.38%!
BBY has been paying a dividend for at least 10 years, so it has 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)13.38%
Div Incr Years14
Div Non Decr Years14
5.3 Sustainability
BBY pays out 124.34% 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.
DP124.34%
EPS Next 2Y3.28%
EPS Next 3Y5.26%
67.84
-1.77 (-2.54%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners90.22%
Inst Owner Change-2.08%
Ins Owners0.33%
Ins Owner Change0.21%
Market Cap14.25B
Revenue(TTM)41.83B
Net Income(TTM)645.00M
Analysts68.39
Price Target85.28 (25.71%)
Short Float %6.15%
Short Ratio3.09
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.45% |
Yearly Dividend3.78
Dividend Growth(5Y)13.38%
DP124.34%
Div Incr Years14
Div Non Decr Years14
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.27%
Min EPS beat(2)4.59%
Max EPS beat(2)5.96%
EPS beat(4)4
Avg EPS beat(4)5.35%
Min EPS beat(4)4.41%
Max EPS beat(4)6.45%
EPS beat(8)7
Avg EPS beat(8)6.21%
EPS beat(12)11
Avg EPS beat(12)8.03%
EPS beat(16)13
Avg EPS beat(16)9.05%
Revenue beat(2)1
Avg Revenue beat(2)0.52%
Min Revenue beat(2)-0.14%
Max Revenue beat(2)1.18%
Revenue beat(4)2
Avg Revenue beat(4)0.08%
Min Revenue beat(4)-1.51%
Max Revenue beat(4)1.18%
Revenue beat(8)2
Avg Revenue beat(8)-0.72%
Revenue beat(12)2
Avg Revenue beat(12)-0.91%
Revenue beat(16)4
Avg Revenue beat(16)-0.65%
PT rev (1m)2.35%
PT rev (3m)6.02%
EPS NQ rev (1m)-1.36%
EPS NQ rev (3m)-1.65%
EPS NY rev (1m)1.28%
EPS NY rev (3m)1.31%
Revenue NQ rev (1m)-0.21%
Revenue NQ rev (3m)-0.22%
Revenue NY rev (1m)0.2%
Revenue NY rev (3m)0.33%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.58 | ||
| Fwd PE | 9.97 | ||
| P/S | 0.34 | ||
| P/FCF | 9.41 | ||
| P/OCF | 6.42 | ||
| P/B | 5.37 | ||
| P/tB | 7.65 | ||
| EV/EBITDA | 5.75 |
EPS(TTM)6.41
EY9.45%
EPS(NY)6.81
Fwd EY10.03%
FCF(TTM)7.21
FCFY10.62%
OCF(TTM)10.57
OCFY15.58%
SpS199.07
BVpS12.63
TBVpS8.87
PEG (NY)101.94
PEG (5Y)13.19
Graham Number42.68
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.84% | ||
| ROE | 24.31% | ||
| ROCE | 26.11% | ||
| ROIC | 19.29% | ||
| ROICexc | 22.38% | ||
| ROICexgc | 25.95% | ||
| OM | 4.16% | ||
| PM (TTM) | 1.54% | ||
| GM | 22.5% | ||
| FCFM | 3.62% |
ROA(3y)7.85%
ROA(5y)9.4%
ROE(3y)41.48%
ROE(5y)48.98%
ROIC(3y)19.35%
ROIC(5y)22.54%
ROICexc(3y)25.47%
ROICexc(5y)38.8%
ROICexgc(3y)34.77%
ROICexgc(5y)61.16%
ROCE(3y)26.19%
ROCE(5y)30.58%
ROICexgc growth 3Y-32.43%
ROICexgc growth 5Y-4.41%
ROICexc growth 3Y-24.39%
ROICexc growth 5Y-2.87%
OM growth 3Y-10.46%
OM growth 5Y-2.33%
PM growth 3Y-22.2%
PM growth 5Y-8.77%
GM growth 3Y0.15%
GM growth 5Y-0.37%
F-Score7
Asset Turnover2.49
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.44 | ||
| Debt/FCF | 0.77 | ||
| Debt/EBITDA | 0.45 | ||
| Cap/Depr | 83.77% | ||
| Cap/Sales | 1.69% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 85.89% | ||
| Profit Quality | 234.73% | ||
| Current Ratio | 1.05 | ||
| Quick Ratio | 0.26 | ||
| Altman-Z | N/A |
F-Score7
WACC9.41%
ROIC/WACC2.05
Cap/Depr(3y)89.65%
Cap/Depr(5y)87.75%
Cap/Sales(3y)1.85%
Cap/Sales(5y)1.69%
Profit Quality(3y)89.19%
Profit Quality(5y)120.88%
High Growth Momentum
Growth
EPS 1Y (TTM)-1.69%
EPS 3Y-13.97%
EPS 5Y0.8%
EPS Q2Q%11.11%
EPS Next Y0.1%
EPS Next 2Y3.28%
EPS Next 3Y5.26%
EPS Next 5Y9.76%
Revenue 1Y (TTM)-0.95%
Revenue growth 3Y-7.08%
Revenue growth 5Y-0.99%
Sales Q2Q%2.4%
Revenue Next Year1.41%
Revenue Next 2Y1.39%
Revenue Next 3Y1.56%
Revenue Next 5Y2.13%
EBIT growth 1Y-2.08%
EBIT growth 3Y-16.8%
EBIT growth 5Y-3.29%
EBIT Next Year53.62%
EBIT Next 3Y18.23%
EBIT Next 5Y12.62%
FCF growth 1Y10.03%
FCF growth 3Y-17.9%
FCF growth 5Y-5.24%
OCF growth 1Y-0.05%
OCF growth 3Y-13.59%
OCF growth 5Y-3.94%
BEST BUY CO INC / BBY FAQ
What is the ChartMill fundamental rating of BEST BUY CO INC (BBY) stock?
ChartMill assigns a fundamental rating of 5 / 10 to BBY.
Can you provide the valuation status for BEST BUY CO INC?
ChartMill assigns a valuation rating of 7 / 10 to BEST BUY CO INC (BBY). This can be considered as Undervalued.
How profitable is BEST BUY CO INC (BBY) stock?
BEST BUY CO INC (BBY) has a profitability rating of 6 / 10.
Can you provide the PE and PB ratios for BBY stock?
The Price/Earnings (PE) ratio for BEST BUY CO INC (BBY) is 10.58 and the Price/Book (PB) ratio is 5.37.
How sustainable is the dividend of BEST BUY CO INC (BBY) stock?
The dividend rating of BEST BUY CO INC (BBY) is 7 / 10 and the dividend payout ratio is 124.34%.