Will Best Buy Q1 Earnings Rise Above Low Expectations?

Best Buy Co. Inc. (NYSE: BBY | BBY Price Prediction) is scheduled to release its fiscal first-quarter financial results before the opening bell on Thursday. Analysts are calling for $0.60 in earnings per share (EPS) and $8.35 billion in revenue. The same period of last year reportedly had $1.02 in EPS and $9.14 billion in revenue.

The company previously issued guidance for the first quarter of EPS in the range of $1.00 to $1.05, enterprise revenue between $9.1 billion and $9.2 billion, and comparable sales growth of flat to up 1.0%. However, Best Buy withdrew all guidance for the 2021 fiscal year back in March.

During the fiscal fourth quarter, enterprise comparable sales increased 3.2% year over year, compared with an increase of 3.0% last year. This consists of domestic comparable sales increasing 3.4%, domestic comparable online sales increasing 18.7% and international comparable sales increasing 1.6%.

At that time, the largest comparable sales growth drivers were headphones, computing, appliances, mobile phones and tablets. These drivers were partially offset by declines in the gaming category.

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Also, domestic revenue totaled $13.85 billion, with online revenue making up about $3.52 billion of these sales. International revenues were $1.35 billion.

Given the great changes in conditions since then, it’s no surprise that Wall Street is somewhat wary. Yet, excluding Wednesday’s move, Best Buy stock had outperformed the S&P 500 and Dow Jones industrial average with a decline of about 5% year to date. In the past 52 weeks, the share price was up 21%.

A few analysts weighed in on Best Buy ahead of the report:

• CFRA has a Buy rating and a $90 price target.
• UBS has a Neutral rating with an $80 price target.
• Telsey Advisory Group rates it as Outperform with a $90 target.
• Wells Fargo has an Equal Weight rating and a $75 price target.
• Nomura has a Buy rating with an $85 price target.

Best Buy stock traded up about 1% at $84.30 on Wednesday, in a 52-week range of $48.11 to $91.99. The consensus price target is $80.22.

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