Best Buy's stock is up 12% despite weak sales, diversification efforts boosting margins.

From Nasdaq: 2024-12-11 21:27:23

Best Buy’s stock (NYSE: BBY) has risen 12% year-to-date to $87, underperforming the S&P. Q3 earnings missed expectations, with adjusted EPS at $1.26 and revenue at $9.45 billion. Diversification efforts have boosted margins, but comparable sales fell 3.7%. Future growth plans include expanding in Canada and launching a U.S. marketplace.

President-elect Donald Trump plans to increase import tariffs, impacting Best Buy’s top import sources – China and Mexico. The company expects increased costs to be shared among itself, vendors, and customers. Peer comparisons show Best Buy’s returns at 12% YTD, outperforming the S&P at 28%.

Best Buy revised FY 2025 guidance, projecting revenue between $41.1-41.5 billion and a decline in comparable sales of 2.5-3.5%. Revenues are forecasted to be $41.4 billion, down 5% y-o-y, with adjusted EPS at $6.23. The updated valuation is $90 per share based on a 14.4x P/E multiple for fiscal 2025.



Read more at Nasdaq: Despite Weak Sales, Best Buy’s Stock Up 12%: What’s Going On?