Maven: Missing the Big P

How something so basic in news coverage can be such an unseen enemy of the successful investor is beyond The Business Press Maven, but we have seen it once again with Best Buy(BBY Quote). You might wonder why The Business Press Maven spends these early morning hours sobbing convulsively, but this is the reason: At the start of the holiday season, I chastised the media at large for focusing on sales at stores and malls around the nation.

Thanks to the sending of reporters out to settings such as Best Buy a million times, crowds of shoppers were, as always, portrayed as good indicators of the success of the season. It is the comic refrain of the holiday shopping period and always happens. But this does too, and it ain't funny: By midway through the season, the investor begins to be reminded once again that the only thing that matters in the end is profit, the big P.

And so it was that Best Buy reported that for the quarter ended Nov. 25, which includes sales from the elongated holiday season but just as importantly gives good hints of what's to come, net income was way lower than expected. The major issue? Promotions, the bigger P. The upshot? Gross margins bit the big one. ...