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Best Buy (BBY) Gains But Lags Market: What You Should Know

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Best Buy (BBY - Free Report) closed at $67.62 in the latest trading session, marking a +0.77% move from the prior day. This move lagged the S&P 500's daily gain of 0.8%. At the same time, the Dow added 0.82%, and the tech-heavy Nasdaq gained 1.14%.

Prior to today's trading, shares of the consumer electronics retailer had lost 8.38% over the past month. This has lagged the Retail-Wholesale sector's loss of 3.96% and the S&P 500's loss of 3.2% in that time.

Investors will be hoping for strength from BBY as it approaches its next earnings release, which is expected to be May 23, 2019. In that report, analysts expect BBY to post earnings of $0.88 per share. This would mark year-over-year growth of 7.32%. Our most recent consensus estimate is calling for quarterly revenue of $9.14 billion, up 0.36% from the year-ago period.

BBY's full-year Zacks Consensus Estimates are calling for earnings of $5.66 per share and revenue of $43.61 billion. These results would represent year-over-year changes of +6.39% and +1.71%, respectively.

Investors might also notice recent changes to analyst estimates for BBY. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.37% higher within the past month. BBY is currently sporting a Zacks Rank of #3 (Hold).

Investors should also note BBY's current valuation metrics, including its Forward P/E ratio of 11.85. For comparison, its industry has an average Forward P/E of 11.85, which means BBY is trading at a no noticeable deviation to the group.

Investors should also note that BBY has a PEG ratio of 1.35 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Retail - Consumer Electronics was holding an average PEG ratio of 0.95 at yesterday's closing price.

The Retail - Consumer Electronics industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 222, putting it in the bottom 14% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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