Free Post Earnings Research Report: Best Buy's Revenue Grew 4%; EPS Surged 30%
Stock Monitor: Conn's Post Earnings Reporting
LONDON, UK / ACCESSWIRE / December 28, 2017 / Active-Investors.com has just released a free earnings report on Best Buy Co., Inc. (NYSE: BBY). If you want access to this report all you need to do is sign up now by clicking the following link www.active-investors.com/registration-sg/?symbol=BBY. Best Buy reported its third quarter fiscal 2018 operating results on November 14, 2017. The retailer of technology products, services, and solutions in the United States, Canada, and Mexico reported earnings in-line with market expectations and raised its revenue and earnings outlook for fiscal year 2018. Register today and get access to over 1,000 Free Research Reports by joining our site below:
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Earnings Highlights and Summary
For the third quarter ended October 28, 2017, Best Buy reported revenues of $9.32 billion, up 4% compared to $8.95 billion in Q3 FY17. The Company's revenue fell short of analysts' estimates of $9.36 billion.
During Q3 FY18, Best Buy posted diluted earnings per share from continuing operations of $0.78, reflecting an increase of 30% from $0.60 in Q3 FY17. The Company's earnings met Wall Street's estimates of $0.78 per share.
Best Buy's Segment Results
During Q3 FY18, the Domestic segment's revenue grew 3.6% on a y-o-y basis to $8.5 billion, driven by comparable sales growth of 4.5%, but partially offset by the loss of revenue from 10 large format and 44 Best Buy Mobile store closures. From a merchandising perspective, Best Buy generated growth across almost all of its categories, with the largest drivers of comparable sales being appliances, computing and smart home.
The domestic segment's online revenue was $1.1 billion, increasing 22.3% on a comparable basis, primarily due to higher conversion rates and higher average order values. As a percentage of total Domestic revenue, the Company's online revenue increased 190 basis points to 12.7% versus 10.8% in the year ago same period.
During Q3 FY18, the domestic segment's gross profit rate came in flat at 24.7% on a y-o-y basis. The Company's improved margin rates across multiple categories were offset by an approximately 25-basis point negative impact from lapping the $25 million in Q3 FY17 periodic profit sharing benefit from Best Buy's service plan portfolio.
For Q3 FY18, the International segment's revenue advanced 10.1% to $829 million on a y-o-y basis, primarily driven by approximately 530 basis points of positive foreign currency impact; and comparable sales growth of 3.8% due to growth in both Canada and Mexico.
During Q3 FY18, the International segment's gross profit rate was 22.2% versus 24.3% in Q3 FY17. The 210-basis point decline was primarily driven by a lower y-o-y gross profit rate in Canada due to lower sales in the higher-margin services category primarily driven by the launch of Canada's total tech support offer, a long-term recurring revenue model.
Share Repurchases and Dividends
During Q3 FY18, Best Buy returned a total of $469 million to shareholders through share repurchases and dividends. On a year-to-date basis, the Company has returned a total of $1.45 billion to shareholders through share repurchases and dividends.
On March 01, 2017, Best Buy announced the intent to spend $3 billion on share repurchases over a two-year period. In Q3 FY18, the Company repurchased 6.4 million shares for a total of $367 million. On a year-to-date basis, Best Buy has repurchased 21.8 million shares for a total of $1.14 billion. The Company's cumulative share repurchases, net of dilution from equity based awards, positively benefitted diluted EPS by approximately $0.04 in Q3 FY18.
Outlook
Best Buy raised its full year revenue growth outlook to 4.0% to 4.8% versus its previous outlook of approximately 4.0%. The Company also raised its non-GAAP operating income growth outlook to 7.0% to 9.5%3 versus its previous outlook of 4.0% to 9.0%.
Stock Performance Snapshot
December 27, 2017 - At Wednesday's closing bell, Best Buy's stock was slightly up 0.50%, ending the trading session at $68.36.
Volume traded for the day: 1.97 million shares.
Stock performance in the last month - up 19.89%; previous three-month period - up 20.63%; past twelve-month period - up 52.76%; and year-to-date - up 60.21%
After yesterday's close, Best Buy's market cap was at $19.97 billion.
Price to Earnings (P/E) ratio was at 17.32.
The stock has a dividend yield of 1.99%.
The stock is part of the Services sector, categorized under the Electronics Stores industry. This sector was flat at the end of the session.
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