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Best Buy's (BBY) Omnichannel Moves Look Good: Apt to Hold
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Best Buy Co., Inc.’s (BBY - Free Report) omnichannel efforts to efficiently cater to consumers’ necessities are commendable. The company continuously focuses on improving its digital capabilities including boosting its services, such as buy online and pickup in store services. BBY is also deepening its customer engagement with more in-home consultations and installations.
Buoyed by the aforesaid tailwinds, shares of this electronics retailer have gained 11.9% over the course of a year, compared with the industry’s 1.3% rise. For fiscal 2025, the Zacks Consensus Estimate for Best Buy’s sales and earnings per share (EPS) is currently pegged at $44.6 billion and $6.86, respectively. These estimates mirror corresponding growth of 1.1% and 14.1% year over year.
Let’s delve deeper.
Strategic Discussion
Best Buy provides convenient pickup options like in-store pickup, curbside pickup, lockers and alternate pickup locations. The company’s consultation service, which supports customers with personalized tech needs, has been gaining traction. It has also been offering free next-day delivery on several items along with convenience store and curbside pickup options. In fiscal 2023, digital sales accounted for 33% of the domestic revenues versus 19% of the same in fiscal 2020.
Going forward, management is focused on making significant investments in fundamental technology capabilities, such as data and analytics as well as cloud migration to drive scale, efficiency and effectiveness. The company also continues making investments in the stores and elevating unique experiences. Best Buy has been testing various store formats and operating models. It is on track to deliver the fiscal 2024 store plans, including closing 20-30 large format stores and implementing eight Experience store remodels, while opening nearly 10 additional outlet stores. Moreover, the company has made investments in the distribution center network to improve productivity.
Image Source: Zacks Investment Research
Additionally, Best Buy’s annual membership program, Best Buy Totaltech, appears encouraging. The program provides customers tech support from Geek Squad agents, exclusive member prices on merchandise, up to 24 months of product protection on most purchases and free delivery and installation. Beginning Jun 27, the membership program will offer three tiers which areMy Best Buy, My Best Buy Plus and My Best Buy Total. My Best Buy will remain the company’s free tier plan for customers looking for convenience, including free shipping with no minimum purchase and gains connected with a member account, such as online access to purchase history, order tracking and fast checkout.
My Best Buy Plus is the latest membership plan for customers prioritizing value and access. For $49.99 per year, customers get everything including the My Best Buy offering with exciting prices and access to product releases. Free two-day shipping with an expanded 60-day return and exchange window on the majority of the products can further be availed.
My Best Buy Total is a membership plan for customers looking for protection and support. This tier is an evolution of the company’s Totaltech offer at $179.99 per year. It consists of the entire benefits from the Plus tier, along with the Geek Squad 24/7 tech support via in-store, remote, phone or chat on all the electronics. This tier also includes up to two years of product protection with AppleCare+ on many new Best Buy purchases. The membership program is likely to contribute nearly 25 basis points of year-over-year operating income rate expansion in fiscal 2024.
Furthermore, the company is making significant headway in the health and beauty category. To this end, management launched a skincare technology product across the company’s stores and online. In the health business category, the company has launched over-the-counter hearing aids in the stores and online, with an online hearing assessment tool. The company is also focused on Care at Home solution, which leverages current health, the company’s major technology platform, thus bringing together remote patient monitoring, telehealth, a complete support model and patient engagement into a single solution for healthcare providers and pharmaceutical organizations.
To wrap up, Best Buy seems well-poised to tap growth opportunities, given its solid tech-agnostic drives. An expected long-term earnings growth rate of 8.1% coupled with a Value Score of A further speaks volumes for this Zacks Rank #3 (Hold) stock.
Solid Picks in Retail
We have highlighted three better-ranked stocks, namely Abercrombie & Fitch (ANF - Free Report) , American Eagle Outfitters (AEO - Free Report) and Hibbett Sports (HIBB - Free Report) .
The Zacks Consensus Estimate for Abercrombie & Fitch’s current financial-year sales and EPS suggests growth of 2.1% and 472%, respectively, from the year-ago reported figures. ANF delivered a negative trailing four-quarter earnings surprise of 141.2%, on average.
American Eagle Outfitters, a retailer of casual apparel, accessories and footwear, currently carries a Zacks Rank #2 (Buy). AEO delivered an earnings surprise of 23.3% in the last reported quarter.
The Zacks Consensus Estimate for American Eagle Outfitters’ current financial-year sales and EPS suggests growth of 1.4% and 15.5%, respectively, from the year-ago reported figures.
Hibbett, a sporting goods retailer, currently carries a Zacks Rank of 2. The company has a negative trailing four-quarter earnings surprise of 13.9%, on average.
The consensus estimate for Hibbett’s current financial-year sales suggests growth of 5.7% from the year-ago reported figure.
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Best Buy's (BBY) Omnichannel Moves Look Good: Apt to Hold
Best Buy Co., Inc.’s (BBY - Free Report) omnichannel efforts to efficiently cater to consumers’ necessities are commendable. The company continuously focuses on improving its digital capabilities including boosting its services, such as buy online and pickup in store services. BBY is also deepening its customer engagement with more in-home consultations and installations.
Buoyed by the aforesaid tailwinds, shares of this electronics retailer have gained 11.9% over the course of a year, compared with the industry’s 1.3% rise. For fiscal 2025, the Zacks Consensus Estimate for Best Buy’s sales and earnings per share (EPS) is currently pegged at $44.6 billion and $6.86, respectively. These estimates mirror corresponding growth of 1.1% and 14.1% year over year.
Let’s delve deeper.
Strategic Discussion
Best Buy provides convenient pickup options like in-store pickup, curbside pickup, lockers and alternate pickup locations. The company’s consultation service, which supports customers with personalized tech needs, has been gaining traction. It has also been offering free next-day delivery on several items along with convenience store and curbside pickup options. In fiscal 2023, digital sales accounted for 33% of the domestic revenues versus 19% of the same in fiscal 2020.
Going forward, management is focused on making significant investments in fundamental technology capabilities, such as data and analytics as well as cloud migration to drive scale, efficiency and effectiveness. The company also continues making investments in the stores and elevating unique experiences. Best Buy has been testing various store formats and operating models. It is on track to deliver the fiscal 2024 store plans, including closing 20-30 large format stores and implementing eight Experience store remodels, while opening nearly 10 additional outlet stores. Moreover, the company has made investments in the distribution center network to improve productivity.
Image Source: Zacks Investment Research
Additionally, Best Buy’s annual membership program, Best Buy Totaltech, appears encouraging. The program provides customers tech support from Geek Squad agents, exclusive member prices on merchandise, up to 24 months of product protection on most purchases and free delivery and installation. Beginning Jun 27, the membership program will offer three tiers which areMy Best Buy, My Best Buy Plus and My Best Buy Total. My Best Buy will remain the company’s free tier plan for customers looking for convenience, including free shipping with no minimum purchase and gains connected with a member account, such as online access to purchase history, order tracking and fast checkout.
My Best Buy Plus is the latest membership plan for customers prioritizing value and access. For $49.99 per year, customers get everything including the My Best Buy offering with exciting prices and access to product releases. Free two-day shipping with an expanded 60-day return and exchange window on the majority of the products can further be availed.
My Best Buy Total is a membership plan for customers looking for protection and support. This tier is an evolution of the company’s Totaltech offer at $179.99 per year. It consists of the entire benefits from the Plus tier, along with the Geek Squad 24/7 tech support via in-store, remote, phone or chat on all the electronics. This tier also includes up to two years of product protection with AppleCare+ on many new Best Buy purchases. The membership program is likely to contribute nearly 25 basis points of year-over-year operating income rate expansion in fiscal 2024.
Furthermore, the company is making significant headway in the health and beauty category. To this end, management launched a skincare technology product across the company’s stores and online. In the health business category, the company has launched over-the-counter hearing aids in the stores and online, with an online hearing assessment tool. The company is also focused on Care at Home solution, which leverages current health, the company’s major technology platform, thus bringing together remote patient monitoring, telehealth, a complete support model and patient engagement into a single solution for healthcare providers and pharmaceutical organizations.
To wrap up, Best Buy seems well-poised to tap growth opportunities, given its solid tech-agnostic drives. An expected long-term earnings growth rate of 8.1% coupled with a Value Score of A further speaks volumes for this Zacks Rank #3 (Hold) stock.
Solid Picks in Retail
We have highlighted three better-ranked stocks, namely Abercrombie & Fitch (ANF - Free Report) , American Eagle Outfitters (AEO - Free Report) and Hibbett Sports (HIBB - Free Report) .
Abercrombie & Fitch, a leading casual apparel retailer, currently sports a Zacks Rank #1(Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Abercrombie & Fitch’s current financial-year sales and EPS suggests growth of 2.1% and 472%, respectively, from the year-ago reported figures. ANF delivered a negative trailing four-quarter earnings surprise of 141.2%, on average.
American Eagle Outfitters, a retailer of casual apparel, accessories and footwear, currently carries a Zacks Rank #2 (Buy). AEO delivered an earnings surprise of 23.3% in the last reported quarter.
The Zacks Consensus Estimate for American Eagle Outfitters’ current financial-year sales and EPS suggests growth of 1.4% and 15.5%, respectively, from the year-ago reported figures.
Hibbett, a sporting goods retailer, currently carries a Zacks Rank of 2. The company has a negative trailing four-quarter earnings surprise of 13.9%, on average.
The consensus estimate for Hibbett’s current financial-year sales suggests growth of 5.7% from the year-ago reported figure.