Best Buy Co., Inc. (BBY): New Analyst Report from Zacks Equity Research - Zacks Equity Research Report

Summary:

Aided by strength seen in key categories along with continuing success of "Renew Blue" program, Best Buy posted better-than expected third-quarter fiscal 2015 results. The company reported earnings of $0.32 per share that came ahead of both the Zacks Consensus Estimate and the year-ago quarter figure. Moreover, the company's earnings have beaten the Zacks Consensus Estimate in the trailing four quarters by an average of 41.6%. Domestic online sales rose 22% in the quarter and Best Buy remains focused on extensively developing its e-commerce/omni-channel capabilities. However, unfavorable product mix, aggressive promotional backdrop and stiff competition emerge as potential threats to its growth prospects. As a result management holds a cautious stance and expects revenues and comps to be flat in the final quarter, which includes the crucial holiday season. Consequently, we stay Neutral on the stock.

Overview:

Incorporated in 1966 and headquartered in Richfield, MN. Best Buy Company Inc. (BBY) is a multinational specialty retailer of consumer electronics, home office products, entertainment software, appliances and related services with 1,495 domestic locations and 473 international outlets at the end of fiscal 2014. The Company operates retail stores and websites under the brand names Best Buy (BestBuy.com, BestBuy.ca, espanol.BestBuy.com and BestBuyMobile.com), Five Star, Future Shop (FutureShop.ca), Geek Squad, Magnolia Audio Video (MagnoliaAV.com), and Pacific Sales (PacificSales.com).

Best Buy operates through two business segments:

Domestic Operations: Best Buy's domestic operations comprises all store, call center and online operations, operating under the brand names Best Buy, Best Buy Mobile, Geek Squad, Magnolia Audio Video and Pacific Sales.

International Operations: Best Buy's international operations consists of all store, call center and online operations in Canada under the brand names Best Buy, Best Buy Mobile, Cell Shop, Connect Pro, Future Shop and Geek Squad. The Company also carries out operations in China under the brand names Best Buy Mobile and Five Star, and in Mexico under the brand names Best Buy, Best Buy Express and Geek Squad.

Best Buy divested its 50% stake in Best Buy Europe to Carphone Warehouse Group, the joint venture (JV) partner in the same.

In Feb 2014, Best Buy concluded the sale of mindSHIFT Technologies, acquired in Dec 2011.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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