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Best Buy Earnings: A Cinderella Story?

Shares of consumer electronics retailer Best Buy (NYSE: BBY  ) popped after the company beat earnings this quarter, bringing the stock up to the tune of 200% year to date. Much of the earnings beat was due to the company's successful implementation of several of its Renew Blue initiatives to cut costs, but some investors worry that the company can trim only so far. Is this earnings beat indicative of a true turnaround for the bricks-and-mortar retailer? In this video, Motley Fool consumer-goods analyst Blake Bos tells us why Wall Street has way overblown the death of Best Buy and the end of bricks-and-mortar retailers, and why there may be several reasons to believe in Blue today.

At the same time, the retail space is in the midst of the biggest paradigm shift since mail order took off at the turn of last century. Only the most forward-looking and capable companies will survive, and they'll handsomely reward investors who understand the landscape. You can read about the 3 Companies Ready to Rule Retail in The Motley Fool's special report. Uncovering these top picks is free today; just click here to read more.

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  • Report this Comment On August 24, 2013, at 7:05 PM, grahamsway wrote:

    While I was skeptical Best Buy was going out of business, I'm equally skeptical that the company's much better off as well.

    It seems the main thing BBY has going is some pretty aggressive cost cutting and a talented PR CEO. Both of which only works for so long.

    If you look at the latest earnings report which was deemed terrific by most, its basically juiced by extraordinary items, which in my estimation were placed in operating figures to purposely misdirect.

    The important points that domestic sales were basically flat and gross margins were down seemed cleverly down played.

    As the company will probably be able to present a couple of more good quarters, I'll be seriously considering betting against BBY if it gets into the mid-40's or sometime next Spring.

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