The 10-second takeaway
For the quarter ended March 3 (Q4), Best Buy missed estimates on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded slightly and GAAP earnings per share dropped to a loss.
Gross margins increased, operating margins grew, net margins shrank.
Best Buy notched revenue of $16.73 billion. The 21 analysts polled by S&P Capital IQ expected a top line of $17.23 billion on the same basis. GAAP reported sales were 2.3% higher than the prior-year quarter's $16.26 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
Non-GAAP EPS came in at $2.47. The 25 earnings estimates compiled by S&P Capital IQ predicted $2.15 per share on the same basis. GAAP EPS were -$4.89 for Q4 against $1.62 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 24.5%, 10 basis points better than the prior-year quarter. Operating margin was 7.9%, 40 basis points better than the prior-year quarter. Net margin was -10.2%, 1,420 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $11.27 billion. On the bottom line, the average EPS estimate is $0.53.
Next year's average estimate for revenue is $50.33 billion. The average EPS estimate is $3.64.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 2,788 members out of 3,411 rating the stock outperform, and 625 members rating it underperform. Among 912 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 762 give Best Buy a green thumbs-up, and 150 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Best Buy is hold, with an average price target of $28.42.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of Best Buy. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.