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Best Buy (BBY) to Report Q3 Earnings: What's in the Cards?
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Best Buy Co., Inc. (BBY - Free Report) is likely to register a decline in both the top and bottom lines from the respective prior-year quarter’s reported numbers in its third-quarter fiscal 2024 results on Nov 21, before the opening bell.
The Zacks Consensus Estimate for revenues is pegged at $9,892 million, indicating a 6.6% decrease from the year-ago fiscal quarter’s reported figure. The consensus estimate for quarterly earnings has been stable at $1.19 in the past 30 days, suggesting a 13.8% plunge from the year-ago fiscal quarter’s figure.
BBY delivered an earnings surprise of 15.1% in the last reported quarter. This specialty retailer of consumer products has a trailing four-quarter earnings surprise of 19.2%, on average.
Key Aspects to Note
Best Buy’s focus on boosting its omnichannel services, such as buy online, pickup in-store services and curbside pickup, is expected to have increased customer engagement and driven its performance. The company has been offering free next-day delivery on several items, along with convenience store and curbside pickup options. In the fiscal second quarter, as a percentage of total domestic revenues, online revenues were approximately 33%. This trend is likely to have continued in the fiscal third quarter, given its strong online presence.
In second-quarter fiscal 2024, Best Buy launched significant changes to its Totaltech program that provided customers with more flexibility to choose a membership that fits their technology needs, budget and lifestyle. BBY’s optimization efforts in several areas, including the membership program, health initiatives and cost-control measures, are expected to have expanded its gross margin in the fiscal third quarter. We expect an adjusted gross margin of 23% in the quarter, reflecting a year-over-year improvement of 100 basis points.
The company’s significant headway in the health and beauty segments, along with its investments in the distribution center network to boost operational productivity, is also likely to have augmented its performance in the to-be-reported quarter.
However, it has been encountering low demand across several product categories, including appliances, home theater, computing and mobile phones, which might be reflected in its Domestic segment’s performance. Soft demand, higher spending outside the home category in areas such as travel and entertainment and a high inflationary environment might hurt the international segment’s fiscal third-quarter results.
Our estimate for fiscal third-quarter net sales from the Domestic and International segments is pegged at $9,134.5 million and $748 million, respectively, suggesting year-over-year declines of 6.8% and 5%, respectively.
Our proven model does not conclusively predict an earnings beat for Best Buy this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here.
Best Buy has a Zacks Rank #3 and an Earnings ESP of 0.00% at present. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Stocks Poised to Beat Earnings Estimates
Here are a few companies that, according to our model, have the right combination of elements to come up with an earnings beat this reporting cycle:
The company is likely to register growth in the top and bottom lines when it reports third-quarter fiscal 2023 numbers. The consensus mark for AEO’s quarterly earnings has moved up by a penny to 47 cents per share in the past 30 days. The consensus estimate suggests 11.9% growth from the year-ago quarter’s reported number.
The Zacks Consensus Estimate for American Eagle’s quarterly revenues is pegged at $1.28 billion, suggesting growth of 2.8% from the figure reported in the prior-year quarter.
Abercrombie & Fitch Co. (ANF - Free Report) has an Earnings ESP of +7.17% and carries a Zacks Rank #2. ANF’s earnings for the to-be-reported quarter are expected to increase significantly on a year-over-year basis. The consensus mark for its quarterly earnings has moved up by 1.9% to $1.09 per share in the past 30 days.
The Zacks Consensus Estimate for Abercrombie & Fitch’s quarterly revenues is pegged at $976.7 million, which suggests growth of 11% from the figure reported in the prior-year quarter.
The Gap, Inc. (GPS - Free Report) has an Earnings ESP of +12.87% and a Zacks Rank #3. GPS’ earnings for the to-be-reported quarter are expected to decline by 71.8%. The consensus mark for its quarterly earnings has moved up by 11.1% to 20 cents per share in the past 30 days.
The Zacks Consensus Estimate for Gap’s quarterly revenues is pegged at $3.6 billion, which suggests a fall of 10.5% from the figure reported in the prior-year quarter.
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Best Buy (BBY) to Report Q3 Earnings: What's in the Cards?
Best Buy Co., Inc. (BBY - Free Report) is likely to register a decline in both the top and bottom lines from the respective prior-year quarter’s reported numbers in its third-quarter fiscal 2024 results on Nov 21, before the opening bell.
The Zacks Consensus Estimate for revenues is pegged at $9,892 million, indicating a 6.6% decrease from the year-ago fiscal quarter’s reported figure. The consensus estimate for quarterly earnings has been stable at $1.19 in the past 30 days, suggesting a 13.8% plunge from the year-ago fiscal quarter’s figure.
BBY delivered an earnings surprise of 15.1% in the last reported quarter. This specialty retailer of consumer products has a trailing four-quarter earnings surprise of 19.2%, on average.
Key Aspects to Note
Best Buy’s focus on boosting its omnichannel services, such as buy online, pickup in-store services and curbside pickup, is expected to have increased customer engagement and driven its performance. The company has been offering free next-day delivery on several items, along with convenience store and curbside pickup options. In the fiscal second quarter, as a percentage of total domestic revenues, online revenues were approximately 33%. This trend is likely to have continued in the fiscal third quarter, given its strong online presence.
In second-quarter fiscal 2024, Best Buy launched significant changes to its Totaltech program that provided customers with more flexibility to choose a membership that fits their technology needs, budget and lifestyle. BBY’s optimization efforts in several areas, including the membership program, health initiatives and cost-control measures, are expected to have expanded its gross margin in the fiscal third quarter. We expect an adjusted gross margin of 23% in the quarter, reflecting a year-over-year improvement of 100 basis points.
The company’s significant headway in the health and beauty segments, along with its investments in the distribution center network to boost operational productivity, is also likely to have augmented its performance in the to-be-reported quarter.
However, it has been encountering low demand across several product categories, including appliances, home theater, computing and mobile phones, which might be reflected in its Domestic segment’s performance. Soft demand, higher spending outside the home category in areas such as travel and entertainment and a high inflationary environment might hurt the international segment’s fiscal third-quarter results.
Our estimate for fiscal third-quarter net sales from the Domestic and International segments is pegged at $9,134.5 million and $748 million, respectively, suggesting year-over-year declines of 6.8% and 5%, respectively.
Best Buy Co., Inc. Price and EPS Surprise
Best Buy Co., Inc. price-eps-surprise | Best Buy Co., Inc. Quote
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Best Buy this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here.
Best Buy has a Zacks Rank #3 and an Earnings ESP of 0.00% at present. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Stocks Poised to Beat Earnings Estimates
Here are a few companies that, according to our model, have the right combination of elements to come up with an earnings beat this reporting cycle:
American Eagle (AEO - Free Report) has an Earnings ESP of +5.50% and currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
The company is likely to register growth in the top and bottom lines when it reports third-quarter fiscal 2023 numbers. The consensus mark for AEO’s quarterly earnings has moved up by a penny to 47 cents per share in the past 30 days. The consensus estimate suggests 11.9% growth from the year-ago quarter’s reported number.
The Zacks Consensus Estimate for American Eagle’s quarterly revenues is pegged at $1.28 billion, suggesting growth of 2.8% from the figure reported in the prior-year quarter.
Abercrombie & Fitch Co. (ANF - Free Report) has an Earnings ESP of +7.17% and carries a Zacks Rank #2. ANF’s earnings for the to-be-reported quarter are expected to increase significantly on a year-over-year basis. The consensus mark for its quarterly earnings has moved up by 1.9% to $1.09 per share in the past 30 days.
The Zacks Consensus Estimate for Abercrombie & Fitch’s quarterly revenues is pegged at $976.7 million, which suggests growth of 11% from the figure reported in the prior-year quarter.
The Gap, Inc. (GPS - Free Report) has an Earnings ESP of +12.87% and a Zacks Rank #3. GPS’ earnings for the to-be-reported quarter are expected to decline by 71.8%. The consensus mark for its quarterly earnings has moved up by 11.1% to 20 cents per share in the past 30 days.
The Zacks Consensus Estimate for Gap’s quarterly revenues is pegged at $3.6 billion, which suggests a fall of 10.5% from the figure reported in the prior-year quarter.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.