Best Buy (BBY)
Consumer Discretionary · $21.6B market cap · SEC CIK 0000764478
ahead of 36% of the S&P 500 · #28 of 48 in Consumer Discretionary
Next reports on Nov 24, 2026, with analysts expecting $1.50 in earnings per share.
52-week range $55.10 to $106.83. 3% below its 52-week high and 89% above its low.
The case for BBY
- Earns 43% back on shareholder equity.
- Holds more cash ($1.7B) than long-term debt ($1.2B).
- Earnings per share up 65.8%.
- Pays a 5.3% dividend while you wait.
- Within 3% of its 52-week high: the trend is up.
- Price/sales of 0.5× is lower than 91% of Consumer Discretionary companies.
The case against
- Revenue has shrunk 2.5% a year over five years.
- Net margin of 3.0% leaves very little room for error.
- Revenue grew only 1.4%, roughly the pace of inflation.
What the score is made of
Each factor is half a curve over reported figures and half a rank among the other Consumer Discretionary companies (momentum is judged against fixed thresholds only), and the five are blended by weight. The score is where that blend places it in the S&P 500. It describes the last filing and the current price. It is not a forecast.
| Valuewhat you pay for the earnings and cash, against the growth you get | 49 |
|---|---|
| Growthhow fast revenue and earnings are moving, this year and over five | 23 |
| Profitabilityhow much of the revenue becomes profit, and how much of that is cash | 39 |
| Momentumhow the price has behaved lately | 88 |
| Stabilityhow violently it moves, what it owes and what it pays you | 72 |
- Each factor except momentum is half fixed thresholds, half rank among the 48 Consumer Discretionary companies.
The financials
Revenue growth
Is the business growing? Slowly
| Last 12 months | +1.4% |
|---|---|
| Over 5 years | −2.5% a year |
| FY2026 revenue | $41.7B (0%) |
Free cash flow
Is it generating real cash? A little
| FY2026 free cash flow | $1.3B |
|---|---|
| Of revenue | 3% |
| Of profit | 118% |
Profit margins
Is profitability improving? Holding steady
| Gross margin | 23% |
|---|---|
| Operating margin | 4% |
| Net margin, FY25 → FY26 → now | 2.2% → 2.6% → 3.0% |
Debt vs. cash
Is the balance sheet healthy? Yes, more cash than debt
| Cash | $1.7B |
|---|---|
| Long-term debt | $1.2B |
| Net cash | $573M |
| Years to repay | 0.6 yrs |
Valuation
Is the stock price reasonable? Yes, about fair
| P/E | 16.9× |
|---|---|
| Fair P/E for its growth | 16× |
| P/FCF | 17.1× |
| Forward P/E | 13.5× |
| EV / EBITDA | 10.7× |
At 16.9× earnings it trades close to the 16× that 0% a year of growth plus a 5.3% dividend would justify. At 17.1× free cash flow it trades close to that same mark.
The financials, five years deep
Pulled from Best Buy's XBRL filings on SEC EDGAR. Italic rows are worked out from the others.
| FY2026 | FY2025 | FY2024 | FY2023 | FY2022 | |
|---|---|---|---|---|---|
| Revenue growth | |||||
| Revenue | $41.7B | $41.5B | $43.5B | $46.3B | $51.8B |
| Change on the year | 0% | −4% | −6% | −11% | — |
| Free cash flow | |||||
| Free cash flow | $1.3B | $1.4B | $675M | $894M | $2.5B |
| Of revenue | 3% | 3% | 2% | 2% | 5% |
| Profit margins | |||||
| Gross margin | 22.5% | 22.6% | 22.1% | 21.4% | 22.5% |
| Operating margin | 3.3% | 3.0% | 3.6% | 3.9% | 5.9% |
| Net margin | 2.6% | 2.2% | 2.9% | 3.1% | 4.7% |
| Debt vs. cash | |||||
| Cash | $1.7B | $1.6B | $1.4B | $1.9B | $2.9B |
| Long-term debt | $1.2B | $1.1B | $1.2B | $1.2B | $1.2B |
| Net cash (debt) | $573M | $434M | $295M | $714M | $1.7B |
What Best Buy says it does
Unless the context otherwise requires, the terms “we,” “us,” “our” and the “company” in this Annual Report on Form 10-K refer to Best Buy Co., Inc. and, as applicable, its consolidated subsidiaries. Any references to our website addresses do not constitute incorporation by reference of the information contained on the websites. Description of Business We were incorporated in the state of Minnesota in 1966. We are driven by our purpose to enrich lives through technology and our vision to personalize and humanize technology solutions for every stage of life. We accomplish this by leveraging our unique combination of tech expertise and a human touch to meet our customers’ everyday needs, whether they come to us online, visit our stores or invite us into their homes. We have operations in the U.S. and Canada. Segments and Geographic Areas We have two reportable segments: Domestic and International. The Domestic segment is comprised of our…
Risk factors BBY lists in its 10-K
- Macroeconomic pressures may adversely affect consumer spending and our financial results
- Geopolitical pressures may adversely impact our supply chain, the cost of our products or revenues and financial results
- Catastrophic events could adversely affect our operating results
- Many of the products we sell are highly susceptible to technological advancement, product life-cycle fluctuations and changes in consumer preferences
- If we fail to attract, retain and engage qualified employees, our operations and profitability may be negatively impacted. In addition, changes in market compensation rates could adversely affect our profitability
- Our focus on services exposes us to certain risks that could have a material adverse impact on our revenue, profitability and reputation
- Our reliance on key vendors and mobile network carriers subjects us to various risks and uncertainties which could affect our revenue and profitability
- Demand for the products and services we sell could decline if we fail to maintain positive brand perception and recognition
- Failure to effectively identify, manage and execute enterprise-wide strategies could have a negative impact on our business
- Failure to effectively manage our infrastructure, real estate portfolio and market segmentation strategy may negatively impact our business
- Interruptions and other factors affecting our supply chain may adversely affect our business
- We utilize third-party vendors for certain aspects of our operations, and any material disruption in our relationships or their services may have an adverse impact on our business
- We rely heavily on our information technology systems for key business processes. Any failure or interruption in these systems could have a material adverse impact on our business
- We are subject to statutory, regulatory and legal developments that could have a material adverse impact on our business
- Our business is subject to evolving corporate governance and public disclosure regulations and expectations, including with respect to cybersecurity, corporate responsibility and sustainability matters
- Failure to meet any financial performance guidance or other forward-looking statements we may provide to the public could result in a decline in our stock price
- Failure to effectively manage our costs could have a material adverse effect on our profitability
- We are highly dependent on the cash flows and net earnings we generate during our fiscal fourth quarter, which includes the majority of the holiday shopping season
- Economic, regulatory and other developments could adversely affect our ability to offer attractive promotional financing to our customers and adversely affect the profits we generate from these programs
- Constraints in the banking and capital markets or our vendor credit terms may have a material adverse impact on our liquidity
- Changes in our credit ratings may limit our access to capital and materially increase our borrowing costs