Market Overview

Earnings Preview: Best Buy Co

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Best Buy Co (NYSE: BBY) releases its next round of earnings this Tuesday, November 24. Get the latest predictions in Benzinga's essential guide to the company's Q3 earnings report.

Net Income, Earnings, And Earnings Per Share

Earnings and especially earnings per share (EPS) are useful measures of a company's profitability. Total earnings, which is also referred to as net income, equals total revenue minus total expenses. EPS equals to net income divided by the number of shares outstanding.

Earnings And Revenue

Sell-side analysts expect Best Buy Co's EPS to be near $1.7 on sales of $11.00 billion. Best Buy Co reported a per-share profit of $1.13 when it published results during the same quarter last year. Sales in that period totaled $9.76 billion.

What Are Analyst Estimates And Earnings Surprises, And Why Do They Matter?

Wall Street analysts who study this company will publish analyst estimates of revenue and EPS. The averages of all analyst EPS and revenue estimates are called the "consensus estimates"; these consensus estimates can have a significant effect on a company's performance during an earnings release. When a company posts earnings or revenue above or below a consensus estimate, it has posted an "earnings surprise", which can really move a stock depending on the difference between actual and estimated values.

If the company were to report earnings in line when it publishes results Tuesday, earnings would be up 50.44%. Revenue would be up 12.66% on a year-over-year basis. In comparison to analyst estimates in the past, here is how the company's reported EPS stacks up:

Quarter Q2 2020 Q1 2020 Q4 2020 Q3 2019
EPS Estimate 1.08 0.60 2.75 1.03
EPS Actual 1.71 0.67 2.90 1.13
Revenue Estimate 9.71 B 8.35 B 15.06 B 9.70 B
Revenue Actual 9.91 B 8.56 B 15.20 B 9.76 B

Stock Performance

Shares of Best Buy Co were trading at $119.13 as of November 20. Over the last 52-week period, shares are up 48.46%. Given that these returns are generally positive, long-term shareholders can be satisfied going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Best Buy Co is scheduled to hold the call at 08:00:00 ET and can be accessed here.

 

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Posted-In: Earnings