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Best Buy (BBY) Stock Sinks As Market Gains: What You Should Know

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Best Buy (BBY - Free Report) closed at $78.02 in the latest trading session, marking a -0.78% move from the prior day. This change lagged the S&P 500's daily gain of 0.01%. Meanwhile, the Dow lost 0.45%, and the Nasdaq, a tech-heavy index, added 0.78%.

BBY will be looking to display strength as it nears its next earnings release. In that report, analysts expect BBY to post earnings of $0.66 per share. This would mark a year-over-year decline of 35.29%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $8.34 billion, down 8.75% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $5.26 per share and revenue of $41.59 billion, which would represent changes of -13.34% and -4.69%, respectively, from the prior year.

Any recent changes to analyst estimates for BBY should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. 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. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 16.74% lower. BBY is holding a Zacks Rank of #3 (Hold) right now.

Digging into valuation, BBY currently has a Forward P/E ratio of 14.95. Its industry sports an average Forward P/E of 14.95, so we one might conclude that BBY is trading at a no noticeable deviation comparatively.

Also, we should mention that BBY has a PEG ratio of 1.96. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Retail - Consumer Electronics industry currently had an average PEG ratio of 1.58 as of yesterday's close.

The Retail - Consumer Electronics industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 78, which puts it in the top 31% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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