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Here's How Best Buy (BBY) Is Poised Ahead of Q3 Earnings
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Best Buy Co., Inc. (BBY - Free Report) is likely to register a decline in the top and the bottom line from the respective prior-year quarter’s reported numbers in its third-quarter fiscal 2023 results on Nov 22, before the opening bell.
The Zacks Consensus Estimate for revenues is pegged at $10,292 million, indicating a 13.6% decrease from the year-ago fiscal quarter’s reported figure. Although the Zacks Consensus Estimate for quarterly earnings has been stable in the past 30 days at $1.03 per share, the same suggests an above 50% plunge from the year-ago fiscal quarter’s tally.
We expect revenues to be down 13% from the year-ago fiscal quarter’s level to $10,365 million and adjusted earnings to plunge 51.5% to $1.01 per share. Comparable sales are likely to decrease 12.6% in the quarter under review.
BBY delivered an earnings surprise of 22.2% in the last reported quarter. This specialty retailer of consumer products has a trailing four-quarter earnings surprise of 7%, on average.
Key Aspects to Note
Best Buy’s quarterly performance is likely to have been hurt by a challenging operating environment, including a volatile consumer electronics industry, inflation, supply-chain issues and softness in consumer demand. These factors coupled with increased consumer electronics industry’s promotional activity remain a headwind. Also, investments in the Totaltech initiative are likely to continue putting pressure on BBY’s margins. It has been witnessing lower sales across both its Domestic and International segments for a while.
On its last earnings call, management had expected soft margins and an SG&A rate deleverage for the fiscal third quarter stemming from a higher sales decline. For the fiscal third quarter, BBY had forecast comparable sales to drop slightly above the 12.1% decline seen in the fiscal second quarter.
Nonetheless, Best Buy has been undertaking cost-containment actions for a while to manage profitability. BBY’s focus on developing omnichannel capabilities, including buy online, pickup in-store services, curbside pickup or ship-from-store delivering products to customers, is encouraging.
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. But that’s not the case here. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Best Buy has a Zacks Rank #3 and an Earnings ESP of 0.00%.
Stocks with Favorable Combination
Here are three companies worth considering, as according to our model, these have the right combination of elements to beat on earnings this season:
lululemon athletica (LULU - Free Report) currently has an Earnings ESP of +1.50% and a Zacks Rank #2. LULU is likely to register an increase in the bottom line from the year-ago fiscal quarter’s reported figure in its third-quarter fiscal 2022 results. The Zacks Consensus Estimate for quarterly earnings has been stable at $1.95 per share over the past 30 days, suggesting 20.4% growth from the year-ago fiscal quarter’s reported number. You can see the complete list of today’s Zacks #1 Rank stocks here.
lululemon athletica’s top line is expected to rise from the prior-year fiscal quarter’s reported number. The Zacks Consensus Estimate for quarterly revenues is pegged at $1.80 billion, suggesting a 24.4% rise from the figure reported in the prior-year fiscal quarter. LULU delivered an earnings beat of 10.4%, on average, in the trailing four quarters.
Dollar General (DG - Free Report) has an Earnings ESP of +2.35% and a Zacks Rank #3, currently. DG is likely to register top-line growth from the year-ago fiscal quarter’s tally in its third-quarter fiscal 2022 numbers. The Zacks Consensus Estimate for quarterly revenues is pegged at $9.43 billion, suggesting 10.7% growth from the figure reported in the prior-year fiscal quarter.
The Zacks Consensus Estimate for Dollar General’s earnings for the fiscal third quarter is pegged at $2.54 per share, suggesting 22.1% growth from the year-ago fiscal quarter’s tally. The consensus mark has been stable in the past 30 days. DG delivered an earnings beat of 2.2%, on average, in the trailing four quarters.
Dollar Tree (DLTR - Free Report) has an Earnings ESP of +6.57% and a Zacks Rank of 3, currently. DLTR is likely to register top-line growth from the year-earlier fiscal quarter’s actuals when it reports third-quarter fiscal 2022 numbers. The Zacks Consensus Estimate for quarterly revenues is pegged at $6.83 billion, suggesting 6.5% growth from the figure reported in the prior-year fiscal quarter.
The Zacks Consensus Estimate for Dollar Tree’s earnings for the fiscal third quarter is pegged at $1.16 per share, suggesting 20.8% growth from the year-ago fiscal quarter’s tally. The consensus mark has been stable in the past 30 days. DLTR delivered an earnings beat of 8.6%, on average, in the trailing four quarters.
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Here's How Best Buy (BBY) Is Poised Ahead of Q3 Earnings
Best Buy Co., Inc. (BBY - Free Report) is likely to register a decline in the top and the bottom line from the respective prior-year quarter’s reported numbers in its third-quarter fiscal 2023 results on Nov 22, before the opening bell.
The Zacks Consensus Estimate for revenues is pegged at $10,292 million, indicating a 13.6% decrease from the year-ago fiscal quarter’s reported figure. Although the Zacks Consensus Estimate for quarterly earnings has been stable in the past 30 days at $1.03 per share, the same suggests an above 50% plunge from the year-ago fiscal quarter’s tally.
We expect revenues to be down 13% from the year-ago fiscal quarter’s level to $10,365 million and adjusted earnings to plunge 51.5% to $1.01 per share. Comparable sales are likely to decrease 12.6% in the quarter under review.
BBY delivered an earnings surprise of 22.2% in the last reported quarter. This specialty retailer of consumer products has a trailing four-quarter earnings surprise of 7%, on average.
Key Aspects to Note
Best Buy’s quarterly performance is likely to have been hurt by a challenging operating environment, including a volatile consumer electronics industry, inflation, supply-chain issues and softness in consumer demand. These factors coupled with increased consumer electronics industry’s promotional activity remain a headwind. Also, investments in the Totaltech initiative are likely to continue putting pressure on BBY’s margins. It has been witnessing lower sales across both its Domestic and International segments for a while.
On its last earnings call, management had expected soft margins and an SG&A rate deleverage for the fiscal third quarter stemming from a higher sales decline. For the fiscal third quarter, BBY had forecast comparable sales to drop slightly above the 12.1% decline seen in the fiscal second quarter.
Nonetheless, Best Buy has been undertaking cost-containment actions for a while to manage profitability. BBY’s focus on developing omnichannel capabilities, including buy online, pickup in-store services, curbside pickup or ship-from-store delivering products to customers, is encouraging.
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. But that’s not the case here. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Best Buy has a Zacks Rank #3 and an Earnings ESP of 0.00%.
Stocks with Favorable Combination
Here are three companies worth considering, as according to our model, these have the right combination of elements to beat on earnings this season:
lululemon athletica (LULU - Free Report) currently has an Earnings ESP of +1.50% and a Zacks Rank #2. LULU is likely to register an increase in the bottom line from the year-ago fiscal quarter’s reported figure in its third-quarter fiscal 2022 results. The Zacks Consensus Estimate for quarterly earnings has been stable at $1.95 per share over the past 30 days, suggesting 20.4% growth from the year-ago fiscal quarter’s reported number. You can see the complete list of today’s Zacks #1 Rank stocks here.
lululemon athletica’s top line is expected to rise from the prior-year fiscal quarter’s reported number. The Zacks Consensus Estimate for quarterly revenues is pegged at $1.80 billion, suggesting a 24.4% rise from the figure reported in the prior-year fiscal quarter. LULU delivered an earnings beat of 10.4%, on average, in the trailing four quarters.
Dollar General (DG - Free Report) has an Earnings ESP of +2.35% and a Zacks Rank #3, currently. DG is likely to register top-line growth from the year-ago fiscal quarter’s tally in its third-quarter fiscal 2022 numbers. The Zacks Consensus Estimate for quarterly revenues is pegged at $9.43 billion, suggesting 10.7% growth from the figure reported in the prior-year fiscal quarter.
The Zacks Consensus Estimate for Dollar General’s earnings for the fiscal third quarter is pegged at $2.54 per share, suggesting 22.1% growth from the year-ago fiscal quarter’s tally. The consensus mark has been stable in the past 30 days. DG delivered an earnings beat of 2.2%, on average, in the trailing four quarters.
Dollar Tree (DLTR - Free Report) has an Earnings ESP of +6.57% and a Zacks Rank of 3, currently. DLTR is likely to register top-line growth from the year-earlier fiscal quarter’s actuals when it reports third-quarter fiscal 2022 numbers. The Zacks Consensus Estimate for quarterly revenues is pegged at $6.83 billion, suggesting 6.5% growth from the figure reported in the prior-year fiscal quarter.
The Zacks Consensus Estimate for Dollar Tree’s earnings for the fiscal third quarter is pegged at $1.16 per share, suggesting 20.8% growth from the year-ago fiscal quarter’s tally. The consensus mark has been stable in the past 30 days. DLTR delivered an earnings beat of 8.6%, on average, in the trailing four quarters.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.