Best Buy (NYSE:BBY) reports fiscal Q2 2009 earnings tomorrow. Want to know what Wall Street expects to see? Read on. Want to know what really matters? Read on a bit more.

What analysts say:

  • Buy, sell, or waffle? Twenty-five analysts follow Best Buy, giving the stock seven buy ratings, 15 holds, and a trio of sells.
  • Revenue. On average, they expect to see 11% quarterly sales growth to $9.73 billion.
  • Earnings. Profits are predicted to inch up 4% to $0.57 per share.

What management says:
Calling Q1's 13% sales growth and 10% rise in profits a "solid start," CFO Jim Muehlbauer predicted that Best Buy will book $3.25 to $3.40 in profits on somewhere between $43 billion and $44 billion in revenue this year.

Note that this assumes 1% to 3% growth in same-store sales in what Muehlbauer predicts will be a "volatile year for the consumer."

What management does:
In that respect, at least, Muehlbauer has reason to feel optimistic -- Q1 led off with a 3.7% rise in comps. That said, there's a reason profits didn't rise as fast as sales in Q1, and it would appear to be the same reason analysts expect to see a similar relationship between sales and earnings tomorrow: Gross, operating, and net margins have all fallen for two quarters straight, and seem headed for a third.

On the other hand, Best Buy is still earning better margins than supposedly high-margin e-tailer Amazon.com (NASDAQ:AMZN). Better, too, than bricks-'n'-mortar rivals Sears (NASDAQ:SHLD) and Circuit City (NYSE:CC).

Margins

3/07

6/07

9/07

12/07

3/08

5/08

Gross

24.4%

24.1%

24.0%

24.0%

23.9%

23.8%

Operating

5.6%

5.2%

5.3%

5.5%

5.4%

5.3%

Net

3.8%

3.6%

3.6%

3.6%

3.5%

3.4%

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:
Trendlines like those you see above can be deceiving, however. They can lull Fools into believing they know what's going to happen before it happens -- while Best Buy is doing its level best to keep us guessing.

In June, we learned that Best Buy's joint venture with U.K. electronics kingpin The Carphone Warehouse is going forward, expanding Best Buy's growth prospects back in the Mother Country. In unrelated telecom news, August found Best Buy inking a deal to expand its relationship with Apple by selling iPhones in-store. Contrariwise, Best Buy announced just this morning that it will shell out $121 million to purchase Napster (NASDAQ:NAPS) -- putting it into direct competition with Apple's iTunes, Yahoo! (NASDAQ:YHOO), and RealNetworks in the online music space. Fellow Fool Rick Munarriz chimed in with a few thoughts on this latter deal earlier today.

Do the Fools at Motley Fool Stock Advisor and Motley Fool Inside Value think this is a good thing or a bad thing? Both newsletters have recommended the stock -- get our experts' view of the situation when you take a free, 30-day trial of either publication.

Fool contributor Rich Smith does not own shares of any company named above. The Motley Fool has a disclosure policy.