Best Buy Company Inc
) holiday sales numbers came in as a surprise, as the company's
results exhibited signs of improvement.
Total revenue for the beleaguered consumer electronics
retailer came in at $12.8 billion for the 9 weeks period ended
Jan 5, 2013, waning marginally from $12.9 billion for the 9 weeks
period ended Dec 31, 2011. Comparable-store sales inched down
1.4% during the period.
Segment wise, net sales inched down 1.2% to $9.9 billion for
the Domestic segment, while comparable-store sales remained flat.
The company's strategic initiatives, including its price match
policy, multi channel strategy, lucrative assortments and
employee training facilitated the company to come up with
Best Buy stated that appliances, mobile phones and
tablets/eReaders registered positive comparable-store sales
growth, while televisions, entertainment and computing marked a
sales decline during the period. Domestic segment's online
channel revenue jumped 10% to $1.1 billion, reflecting strong
Sturdy online sales performance remains a positive for the
company as heightened competition from online retailers like
), was adversely affecting its sales and profitability.
Moreover, Best Buy has long been struggling with dwindling
sales in key categories including televisions, notebooks, digital
imaging and gaming devices, which in turn, is taking a toll on
the company's same store sales results.
Sales at the company's International segment increased 2.2%
year over year to $2.9 billion. However, comparable-store sales
declined 6.4%, reflecting sales decline in Canada and China.
Currently, we have a long-term 'Underperform' recommendation
on the stock. Moreover, Best Buy, which faces competition from
Wal-Mart Stores Inc
), holds a Zacks Rank #5 (Strong Sell).
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