Since its IPO in November 2003, regional electronics retailer Conn's (NASDAQ:CONN) has posted shareholder returns that have bested archrivals Best Buy (NYSE:BBY) and Circuit City (NYSE:CC).

Beating out Circuit City is no surprise, and taking on Best Buy in its core markets of Texas and Louisiana continues to be a challenge, but Conn's pursues a somewhat unique retailing strategy. Fools can find out more when the company reports second-quarter results tomorrow; here's what to expect.

What analysts say:

  • Buy, sell or waffle? Seven analysts currently follow Conn's. Six are bullish on the stock, and one is on the fence with a hold rating.
  • Revenues. Analysts are projecting $199.9 million in second-quarter sales, or just less than a 10% increase over last year's second-quarter sales amount.
  • Earnings. Analysts expect quarterly earnings of $0.40, or about 14.3% above the $0.35 reported last year.

What management says:
On Aug. 7, Conn's detailed that second-quarter sales increased 9.4% to $179 million, as same-store sales improved 5%. When Conn's released first-quarter results back in May, management said it expected full-year diluted earnings of $1.75-$1.85.

What management does:
Conn's has grown its top line and earnings in the double digits since going public almost four years ago. Net margins have condensed somewhat recently, but have beaten Best Buy over the last 12 months, proving that regional competitors can take on the national big-box giant.

Margins

01/06

04/06

07/06

10/06

01/07

04/07

Gross

35.3%

34.9%

34.4%

34.2%

34.0%

34.3%

Operating

9.3%

9.2%

8.5%

8.1%

8.3%

8.3%

Net

5.9%

5.9%

5.6%

5.4%

5.3%

5.3%

All data courtesy of Capital IQ, a division of Standard & Poor's. Data reflects trailing-12-month performance for the quarters ended in the named months.

One Fool says:
Fellow Fool and retail guru David Meier pointed out that Conn's is as much a financing firm as a retail entity, and additional insight could surface tomorrow, as management mentioned it will be further breaking out finance and other revenue. This should prove insightful, as will any details on the company's expansion plans as it looks to Oklahoma and Arkansas for new store openings.

Circuit City is currently reeling from trying to beat Best Buy at its own game, and Tweeter Home Entertainment recently declared bankruptcy as a result of the tough electronics-retailing environment. That leaves regional competitors hhgregg (NYSE:HGG) and Rex Stores (NYSE:RSC), but neither currently competes with Conn's in its home markets.

For more related Foolishness:

Best Buy is a recommendation of Motley Fool Stock Advisor, where Tom and David Gardner are always on the lookout for the market's best investments. Try it out for yourself -- it's free for 30 days. Best Buy is also an Inside Value recommendation.

Fool contributor Ryan Fuhrmann has no financial interest in any company mentioned. Feel free to email him with feedback or to discuss any companies mentioned further. The Fool has an ironclad disclosure policy.