Stock futures fell Thursday morning, giving back some of the gains Wednesday that sent the S&P 500 to its highest level since early March.
Not only was Best Buy a stronger company heading into the crisis, but its relative strength over Foot Locker is also only likely to accelerate in the months and years ahead. Both companies reported their first-quarter results last week, illustrating the key differences in their business models, sensitivity to stay-at-home orders, and giving a sneak peak into why Best Buy is the more solid pick of the two. During the May quarter, in which Best Buy, Foot Locker, and other retailers were forced to shut their doors to customers, Best Buy's business resilience was clearly on display.
Shares of big box electronics retailer Best Buy (NYSE: BBY) sold off by nearly 6% in early trading Thursday, after reporting Q1 2021 earnings, before climbing back to about a 3.8% loss as of 2:35 p.m. EDT. Curiously, though, Best Buy's earnings were better than expected, not worse. Heading into earnings, analysts had predicted Best Buy would earn $0.60 per share on sales of $8.35 billion.
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Electronics retailer Best Buy Co., Inc. (NYSE: BBY) reported Thursday first quarter results, highlighted by a 5.7% year-over-year drop in comps which was still better than expected. EPS also came in better than expected but the stock traded lower as investors debated its outlook in an uncertain retail environment.The Best Buy Analysts Morgan Stanley analyst Simeon Gutman maintains an Equal-weight rating on Best Buy's stock with a price target lifted from $75 to $85.Oppenheimer analyst Brian Nagel maintains at Outperform, unchanged $105 price target.KeyBanc Capital Markets Bradley Thomas maintains at Sector Weight, no price target.BofA Securities analyst Curtis Nagle maintains at Neutral, unchanged $80 price target.Raymond James analyst Matthew McClintock maintains at Strong Buy, unchanged $100 price target.7 Takeaways On Best Buy's Q1 Best Buy's first quarter earnings report is highlighted by seven key takeaways, Morgan Stanley's Gutman said in a note. They are: 1\. Comps of 5.7% missed a flat-to-negative, low single-digit figure investors expected, but stimulus measures helped lift sales late in the quarter.2\. Sales were impacted by a greater-than-expected impact from store closures, while some rivals kept all of their stores open throughout the quarter.3\. Despite potential share loss in the quarter, Best Buy has a "realistic path" to growing market share, especially from smaller regional and independent rivals.4\. Online sales were up 155% in the quarter versus an average of 16% growth over the past three years. Management deserves credit for showcasing "the sophistication" of its investments in a multichannel business.5\. Gross margins were down 70 basis points in the quarter and margin headwinds should continue throughout 2020, mostly due to unusually high online sales.6\. SG&A declined by roughly $100 million from last year, as the company may be relatively insulated versus other retailers.7\. The company faces "a few tougher quarters" in 2020, although its outlook for 2021 is unchanged.Related Link: Retail Pro Says Giants Like Amazon, Walmart Will Prevail After Coronavirus: 'It's Not Fair'Checking In With Best Buy Management Oppenheimer analysts spoke with Best Buy's senior management to discuss its earnings report and underlying trends, Nagel wrote in a note.The five highlights include:View more earnings on BBY1\. Best Buy's digital platform and omnichannel capabilities are "responding well" to a shift toward online sales.2\. Physical stores remain an important part of the business, as 65% of all sales are shipped or picked up from a physical store.3\. The company is exploring ways of installing and repairing items in homes.4\. In-store services will remain a key component of the business with health precautions.5\. Sales of TVs and large appliances saw an uptick as customers got used to the new curbside business model.Best Buy's COVID-19 Update Best Buy pivoted its stores in late March toward an enhanced curbside-service only model and paused all in-home delivery options, KeyBanc's Thomas wrote in a note. Encouragingly, the company highlighted very strong demand for in-home installations and repairs in the face of social distancing worries.The company did furlough around 51,000 domestic hourly store workers and close to all part-time workers in April. But Best Buy still managed to retain 82% of full-time store and field employees.In late April, Best Buy resumed large product delivery and in-home installations and repairs for new orders and started to open its doors to clients in new May through a new appointment system."Looking ahead, management is evaluating additional changes, including expanding store hours and opening some stores beyond the current appointment-only model," the analyst wrote.Debate On Best Buy's Near-Term Outlook What's next for Best Buy in an uncertain retail environment is up for debate.On one hand, a potentially "very weak" macro environment makes the case for investors to hold a cautious stance due to a "give back in demand," BofA's Nagle said in a note.Management didn't issue any full-year guidance, but said it saw strong sales retention trends so far in the second quarter.Best Buy hasn't signaled when it expects all stores to reopen and may extend store hours or open some locations beyond the appointment-only model at 700 locations, the analyst said. Given a strong sales retention trend so far in the quarter, "this measured approach makes sense."On the other hand, Raymond James analyst McClintock said Best Buy's outlook remains favorable, as it has sufficient liquidity to outlast any economic uncertainty while still making investments on capturing future market share growth. At a time when others are holding a cautious stance, Raymond James is doing the opposite. The research firm is lifting its fiscal 2021 EPS outlook from $4.85 to $5.30 due to an improved comp sales outlook and "somewhat more optimism" on the COVID-19 recovery path.BBY Price Action Best Buy shares were down 1.66% at $76.92 at the close Friday.Related Link: Chop Chop: Strong Earnings Lift Markets After Tuesday Thud; FOMC Minutes AheadPhoto via Wikimedia. Latest Ratings for BBY DateFirmActionFromTo May 2020Nomura InstinetMaintainsNeutral May 2020Morgan StanleyMaintainsEqual-Weight May 2020BarclaysMaintainsOverweight View More Analyst Ratings for BBY View the Latest Analyst Ratings See more from Benzinga * Retail Pro Says Giants Like Amazon, Walmart Will Prevail After Coronavirus: 'It's Not Fair'(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
The Board of Directors of Best Buy Co., Inc. (NYSE:BBY) has authorized the payment of a regular quarterly cash dividend of $0.55 per common share. The quarterly dividend is payable on July 2, 2020, to shareholders of record as of the close of business on June 11, 2020. The company had 257,608,566 shares of common stock issued and outstanding as of May 2, 2020.
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Wall Street's main indexes eased on Thursday from more than two-month highs hit in the previous session, as growing Sino-U.S. tensions and concerns about a rebound from a coronavirus-led economic slump hit sentiment. President Donald Trump said the United States would react strongly if China imposes national security laws for Hong Kong in response to last year's often violent pro-democracy protests. The souring relations between the world's two largest economies over the outbreak has made investors nervous about the Phase 1 trade deal signed earlier this year and stalled a strong rally in Wall Street's main indexes this month.
Walmart has *New Nintendo 2DS XL Console w/ Mario Kart 7* (Black/Turquoise) on sale for *$99.99*. *Shipping is free*. Thanks Dealhunter30
Wall Street ended mixed on Friday in a mostly tame finish to a week of strong gains, as investors gauged China-U.S. tensions and amid ongoing uncertainty about the pace of economic recovery from the coronavirus. President Donald Trump's warning on Thursday that the U.S. would react strongly to China's plan for a national security law in Hong Kong has raised concerns over Washington and Beijing's possibly reneging on their Phase 1 trade deal. Late in the session, stocks edged lower after the U.S. Commerce Department said it was adding 33 Chinese companies and other institutions to an economic blacklist for human rights violations and to address U.S. national security concerns.
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BBY earnings call for the period ending May 2, 2020.
Wall Street ended lower on Thursday, a day after hitting two-month highs, on a fresh wave of China-U.S. tensions that raised doubts about the trade deal reached early this year between the world's two largest economies. President Donald Trump said the United States would react strongly if China imposes national security laws for Hong Kong in response to last year's often violent pro-democracy protests. Earlier, Secretary of State Mike Pompeo criticized Beijing's handling of the coronavirus outbreak, while a Chinese official said the country will not flinch from any escalation in tensions.
Best Buy is expected to earn $0.66/share on $8.34 billion in revenue. Meanwhile, the so-called Whisper number is $0.67. The Whisper number is the Street's unofficial view on earnings.
Wall Street receded on Thursday, a day after hitting two-month highs, on a fresh wave of China-U.S. tensions, raising doubts about the trade deal reached early this year between the world's two largest economies. President Donald Trump said the United States would react strongly if China imposes national security laws for Hong Kong in response to last year's often violent pro-democracy protests. The recent souring relations between the world's two largest economies over the coronavirus pandemic has raised doubts about the Phase 1 trade deal signed earlier this year, interrupting a rally on the U.S. stock market.
Best Buy is benefiting from a surge in demand for home office equipment and gaming consoles, and from its pre-pandemic investments in tech and home health
U.S. stock indexes dropped on Friday as Sino-U.S. tensions weighed on markets struggling to gauge the pace of economic recovery from the coronavirus. President Donald Trump's statement on China's plan for a national security law in Hong Kong on Thursday raised concerns over Washington and Beijing possibly reneging on their Phase-1 trade deal. The three main U.S. stock indexes have kept to a tight range in May, but are still on course for weekly gains between 2.5% and 2.8%.
Yahoo Finance catches up with HP's CEO Enrique Lores fresh off its second fiscal quarter earnings report.
Wall Street was mixed on Friday in a mostly tame finish to a week of strong gains, as investors gauged China-U.S. tensions and amid ongoing uncertainty about the pace of economic recovery from the coronavirus. President Donald Trump's warning on Thursday that the U.S. would react strongly to China's plan for a national security law in Hong Kong has raised concerns over Washington and Beijing's possibly reneging on their Phase 1 trade deal. The rhetoric knocked Wall Street off multi-month highs, although the main indexes were still set to add over 2% for the week, fueled by optimism about an eventual coronavirus vaccine and the easing of virus-related curbs.
This article is part of our monthly series where we highlight five companies that are large cap, relatively safe, dividend paying, and are offering large discounts to their historical norms.These are not normal times, so we adjust our strategy a little bit to…
The global case tally for the coronavirus that causes COVID-19 passed 5 million on Thursday after the biggest one-day increase since the start of the outbreak, as a top U.S. scientist cautioned that people should not rely on a vaccine and the labor market continued to show massive job losses.
Coronavirus has dented clothing and many other non-essential sales, but stay-at-home consumers seeking distraction and escape are helping to not only reverse lower video game sales, but also give them a big jolt.
U.S. retail companies will be eagerly watching Alibaba Group Holding Ltd.’s Friday morning report, when the Chinese e-commerce giant will show what it was like to operate in the heart of the COVID-19 outbreak and emerge on the other side.
U.S. stock indexes moved in a flat-to-low range on Friday as investors gauged Sino-U.S. tensions amid continued uncertainty over the pace of economic recovery from the coronavirus. President Donald Trump's warning on Thursday that the U.S. would react strongly to China's plan for a national security law in Hong Kong raised concerns over Washington and Beijing possibly reneging on their Phase-1 trade deal. The rhetoric knocked Wall Street off multi-month highs, although the main indexes were still set to add between 2.8% and 3.1% for the week on optimism over a vaccine and the easing of virus-related curbs.
Retailer withdrew its financial forecast for fiscal 2021 due to global uncertainty Continue reading...
New research suggests the labor market is undergoing fundamental changes, not just a temporary pause, and that the economic recovery will be slow unless we reform policies that delay the reallocation of workers and capital.
As American retail reopens, it’s once again an odd mosaic of who is choosing to get back in the store business…and who is still sitting it out for a while longer
Our chart of the day says a measure of volatility for markets could offer a hint of what’s to come on the S&P 500.
The Trump Administration's coronavirus relief payment provided a fillip to sales of major retailers in April as millions of Americans used the money to buy everything from video games to sewing machines even as the country struggles with record job losses. Walmart and Target Corp noted in their earnings call this week that quarterly comparable sales, which rose about 10%, got a major boost from increased demand for non-essentials at the end of last month. "Call it relief spending, as it was heavily influenced by stimulus dollars," Walmart Chief Executive Doug McMillon said on Tuesday, citing a jump in sales of clothing, televisions, video games, sporting goods and toys.
U.S. stock indexes moved in a flat-to-low range on Friday as simmering Sino-U.S. tensions weighed on markets struggling to gauge the pace of economic recovery from the coronavirus. President Donald Trump's rhetoric against China's plan for a national security law in Hong Kong on Thursday raised concerns over Washington and Beijing reneging on their phase-1 trade deal.
BBY earnings call for the period ending May 2, 2020.
With an unemployment rate between 15% and 20%, bank accounts draining, and the Dow down 23% in the first quarter, things are dreadful for millions of people.
U.S. stock indexes were set for a near-flat open on Friday as investors weighed hopes of more stimulus to revive an ailing economy against simmering Sino-U.S. trade tensions. "Market sentiment is really vulnerable to expensive valuation at the moment," said Andrea Cicione, head of strategy at TS Lombard.
President Donald Trump said the United States would react strongly if China imposes national security laws for Hong Kong in response to last year's often violent pro-democracy protests. "It seems like China is going to be used as a punching bag for the upcoming elections," said Bob Shea, CEO and co-chief investment officer at TrimTabs Asset Management in New York. The S&P 500 has surged over 30% from its March low, but it remains down about 13% from its Feb. 19 record high.
The global case tally for the coronavirus that causes COVID-19 passed 5 million on Thursday after the biggest one-day increase since the start of the outbreak, as a top U.S. scientist cautioned that people should not rely on a vaccine and the labor market con…
The new business model seems to be working for Best Buy -- and a year from today could look a lot like today.