Best Buy Co., Inc. (BBY) Stock: Why It’s Headed For The Top


Best Buy Co., Inc. (BBY) is working its way for to the top in the market today. The company, focused in the service sector, is presently trading at $71.69 after climbing 1.60% so far today. When it comes to service stocks, there are a number of factors that have the potential to cause gains in the market. One of the most common is news. Here are the recent trending headlines centered around BBY:

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Mar-22-19 09:47AM Best Buy Is Upgraded to Outperform by Oppenheimer
08:01AM 4 Top Stocks to Buy for Superb Earnings Growth
04:06AM Stocks – Nike, Tiffany Fall in Premarket; Best Buy Rises
Mar-21-19 11:48AM The Secret Value Stock Screen to Use Now
Mar-20-19 08:55AM Buy These 5 ROE Stocks as Stock Market Euphoria Continues

However, when making an investing decision, investors should look into far more than news, especially in the ever incredibly complex service sector. Here’s what’s happening with Best Buy Co., Inc..

Performance Trends That We’ve Seen From BBY

Although a move toward the top in a single session, like the gain that we’re seeing from Best Buy Co., Inc. may cause fear in some investors, a single session move by itself shouldn’t be the basis of a decision to, or not to, buy a company’s stock. It’s generally smart to take a look at trends just a single session. As it relates to BBY, here are the movements that we have seen:

  • Past 5 Sessions – Over the last seven days, BBY has generated a price change in the amount of 2.48%.
  • Past Month – The performance from Best Buy Co., Inc. throughout the past 30 days works out to 16.98%.
  • Past Three Months – In the past three months, the stock has generated a ROI of 35.77%
  • Past Six Months – Throughout the last six months, we have seen a change that amounts to -9.19% from the stock.
  • This Year So Far – Since the close of last year BBY has resulted in a return on investment of 33.23%.
  • Annually – Lastly, over the last full year, we have seen performance that comes to 0.74% out of BBY. In this period, the stock has traded at a high of -15.03% and a low price of 50.23%.

Important Ratios

Digging into a few ratios having to do with a company generally gives investors an understanding of just how dangerous and/or potentially profitable a an investment option might be. Below are some of the key ratios to consider when looking at BBY.

Short Ratio – The short ratio is a measure of short interest. As the ratio goes higher, it shows that more investors have a belief that the stock is going to gain. Across the sector, strong service stocks tend to come with a lower short ratio. On the other hand, we also see a lot of short squeezes in the industry. Nonetheless, as it relates to Best Buy Co., Inc., it’s short ratio clocks in at 3.84.

Quick & Current Ratios – The quick and current ratios are tools that are used to get an idea of the company’s liquidity. Essentially, they measure If a company is able to pay for its debts as they mature using current assets or quick assets. do have strong quick and current ratios. As far as BBY, the quick and current ratios total up to 0.30 and 1.10 respectively.  

Book To Share Value – The book to share value ratio compares the the price of shares to the book value of assets that are owned by the company. In this case, that ratio is 10.98.

Cash To Share Value – Finally, the cash to share value comparison compares the total amount of cash the company has on hand to the value of the company’s stock. In this case, the cash to share value comes to 4.90.

Moves From Big Money Players

An interesting fact that I have learned so far in my brief period as an intelligence is that good investors tend to follow big money. Usually, investors that want to keep the risk down will keep an eye on investments made by institutions and insiders of the company. With that said, where is the big money in regard to BBY? Here’s the scoop:

  • Institutions – At the moment, institutions hold 86.40% of BBY. Nonetheless, it is important to consider that institutional ownership has moved in the amount of -2.25% in the past quarter.
  • Investors On The Inside – When it comes to insiders, insiders of the company currently own 0.70% of the company. Insider ownership of the company has seen a change of -40.23% over the last quarter.

How Analysts Feel About Best Buy Co., Inc.

Although it’s not a good idea to unknowingly follow the opinions of analysts, it is a smart idea to use their thoughts when validating your own before making investment decisions in the service space. Here are the recent moves that we have seen from analysts with regard to BBY.

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Mar-20-19 Initiated Evercore ISI In-line $75
Feb-28-19 Reiterated Telsey Advisory Group Market Perform $67 → $74
Feb-27-19 Upgrade BofA/Merrill Underperform → Neutral $50
Dec-19-18 Upgrade MoffettNathanson Sell → Neutral
Dec-17-18 Downgrade BofA/Merrill Neutral → Underperform

What We’ve Seen In Financial Results

At the moment, analysts are expecting that throughout the full year, earnings per diluted share will come in at $5.97. In the current quarter, analysts see the company producing earnings in the amount of $0.86. Over the last 5 years, BBY has generated revenue in the amount of $2.00% with earnings coming in at 49.50%. On a quarter over quarter basis, earnings have seen movement of 27.30% and revenue has seen movement of 2.90%.

How Many Shares Of BBY Are Available?

Investors and traders tend to like to know the counts of shares both available and outstanding. With respect to Best Buy Co., Inc., there are currently 266.09M and there is a float of 229.61M. This means that of the total of 266.09M shares of BBY that are out there today, 229.61M are able to trade hands on the public market.

Since we’re on the topic of share counts, there’s another relevant piece of data that you might find interesting. That would be the short percentage of the float. Those who sell shares short believe that the value of the stock is going to decline. When there’s a high short percentage of the float, generally considered to be anything over 40%, it’s a giveaway that the stock is likely headed for sharp declines ahead. Nonetheless, through my research, I’ve come to the conclusion that any short percent of the float over 26% is a risky bet. When it comes to BBY, the short percent of the float is 5.99%.

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