Best Buy Co Inc

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BBY : NYSE : Services
$53.96 -2.21 | -3.93%
Today's Range: 52.97 - 56.18
Avg. Daily Volume: 4388700.0
07/20/17 - 4:00 PM ET

Financial Analysis


BEST BUY CO INC's gross profit margin for the first quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. Even though sales increased, the net income has decreased. BEST BUY CO INC has weak liquidity. Currently, the Quick Ratio is 0.74 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.

At the same time, stockholders' equity ("net worth") has remained virtually unchanged only increasing by 1.64% 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 FY17 Q1 FY16
Net Sales ($mil)8528.08443.0
EBITDA ($mil)461.0402.0
EBIT ($mil)300.0240.0
Net Income ($mil)188.0229.0


Balance Sheet Q1 FY17 Q1 FY16
Cash & Equiv. ($mil)3782.03065.0
Total Assets ($mil)12955.012901.0
Total Debt ($mil)1347.01378.0
Equity ($mil)4499.04426.0


Profitability Q1 FY17 Q1 FY16
Gross Profit Margin25.625.16
EBITDA Margin5.44.76
Operating Margin3.522.84
Sales Turnover3.053.06
Return on Assets9.167.72
Return on Equity25.9822.5
Debt Q1 FY17 Q1 FY16
Current Ratio1.491.47
Debt/Capital0.230.24
Interest Expense19.020.0
Interest Coverage15.7912.0


Share Data Q1 FY17 Q1 FY16
Shares outstanding (mil)306.0324.0
Div / share0.340.73
EPS0.60.69
Book value / share14.713.66
Institutional Own % n/a n/a
Avg Daily Volume4428732.04554663.0

Valuation


BUY. This stock's P/E ratio indicates a discount compared to an average of 21.43 for the Specialty Retail industry and a discount compared to the S&P 500 average of 24.41. Conducting a second comparison, its price-to-book ratio of 3.72 indicates a premium versus the S&P 500 average of 3.04 and a significant discount versus the industry average of 21.16. 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 14.89 Peers 21.43   BBY 7.30 Peers 13.19

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 13.33 Peers 18.12   BBY 3.71 Peers 1.66

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 discount to its peers.

 

Premium. 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 premium to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
BBY 3.72 Peers 21.16   BBY 26.11 Peers 14.68

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 0.42 Peers 1.40   BBY 0.19 Peers 5.70

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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