Best Buy Co., Inc.

Best Buy Co., Inc. (BBY - Analyst Report), which recently announced the grand opening of 8 new U.S. stores for the first fiscal quarter 2010, continues to see upbeat earnings forecasts from analysts. The company’s fundamentals remain strong and its dividend keeps outpacing the industry.

Company Description

Best Buy is a well-known multinational retailer of consumer electronics, home office products, entertainment software, appliances, and related services in the United States, Canada, Europe, Mexico and China. Best Buy family of brands and partnerships collectively generates more than $40 billion annual revenue.

Recent Events

The company recently announced the grand opening of eight new U.S. stores for the first fiscal quarter 2010. The new stores are scheduled for opening this month and next. Best Buy noted that as of May 30, it expects to operate 1031 U.S. Best Buy stores in 49 states and in Puerto Rico, among other operations.

Solid Performance and Strong Fundamentals

The company posted fiscal fourth-quarter earnings of $1.61 per share, surpassing the consensus estimate by 14%. Revenue jumped 10% year-over-year, though comparable store sales dipped by 5%.

“We prepared for reduced consumer spending, and we were pleased when the quarter finished stronger than it began,” said Brad Anderson, chief executive officer and vice chairman of Best Buy. “This company continues to innovate and take market share because of our culture, our talented employees and our commitment to serving customers.”

Management added that the company responded quickly and effectively to the rapid changes in the macro-economic climate, is addressing the challenging demand environment and continues to see tremendous opportunities

Upbeat Projections and a Rising Share Price

Best Buy also pegged its fiscal 2010 EPS Outlook of $2.50 to $2.90

Analysts remain bullish on earnings, revising earnings forecasts from $2.35 per share of 2 months ago to $2.77 for the year ending February 2010.

Shares of BBY have been on a tear, soaring past the market by 20% to 30% over the past few months.

Favorable Industry Comparisons

Best Buys offers an industry-leading dividend yield of 1.5%. The company’s return on equity (ROE) of 26% topes the industry average of 19. BBY’s earnings per share are expected to grow 12% over the next 3 – 5 years, which is in line with the industry average.

Read the full analyst report on BBY