Best Buy Co Inc

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BBY : NYSE : Services
$33.19 | %
Today's Range: 0.00 - 0.00
Avg. Daily Volume: 5,079,100
07/26/16 - 4:02 PM ET

Financial Analysis


BEST BUY CO INC's gross profit margin for the first quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Even though sales decreased, the net income has increased, representing an increase to the bottom line. BEST BUY CO INC has weak liquidity. Currently, the Quick Ratio is 0.66 which shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

During the same period, stockholders' equity ("net worth") has decreased by 9.07% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q1 FY16 Q1 FY15
Net Sales ($mil)8443.08558.0
EBITDA ($mil)402.0371.0
EBIT ($mil)240.0208.0
Net Income ($mil)229.0129.0


Balance Sheet Q1 FY16 Q1 FY15
Cash & Equiv. ($mil)3065.03913.0
Total Assets ($mil)12901.013719.0
Total Debt ($mil)1378.01607.0
Equity ($mil)4426.04868.0


Profitability Q1 FY16 Q1 FY15
Gross Profit Margin25.1624.81
EBITDA Margin4.764.33
Operating Margin2.842.43
Sales Turnover3.062.93
Return on Assets7.726.56
Return on Equity22.516.72
Debt Q1 FY16 Q1 FY15
Current Ratio1.471.55
Debt/Capital0.240.25
Interest Expense20.020.0
Interest Coverage12.010.4


Share Data Q1 FY16 Q1 FY15
Shares outstanding (mil)324.0353.23
Div / share0.730.74
EPS0.690.1
Book value / share13.6613.78
Institutional Own % n/a n/a
Avg Daily Volume4923012.04845194.0

Valuation


BUY. BEST BUY CO INC's P/E ratio indicates a significant discount compared to an average of 24.35 for the Specialty Retail industry and a significant discount compared to the S&P 500 average of 25.05. To use another comparison, its price-to-book ratio of 2.36 indicates a discount versus the S&P 500 average of 2.81 and a significant discount versus the industry average of 13.96. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. Upon assessment of these and other key valuation criteria, BEST BUY CO INC proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
BBY 11.09 Peers 24.35   BBY 5.76 Peers 15.74

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

BBY is trading at a significant discount to its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

BBY is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
BBY 10.45 Peers 20.26   BBY 0.41 Peers 2.04

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

BBY is trading at a significant discount to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

BBY trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
BBY 2.36 Peers 13.96   BBY 27.63 Peers -3.13

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

BBY is trading at a significant discount to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

BBY is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
BBY 0.27 Peers 1.56   BBY -2.10 Peers 8.06

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

BBY is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

BBY significantly trails its peers on the basis of sales growth

 

 

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