BBY stock is soaring today after Best Buy (NYSE:BBY) said it expects a strong holiday shopping season and forecast Q4 profits well above Wall Street’s expectations.
Forecast Beats Analysts’ Estimates
With Black Friday, the single busiest shopping day of the year, just days away, Best Buy has released its Q3 results, and there plenty of reasons for holders of BBY stock to cheer. The largest consumer electronics retailer in North America posted third-quarter profits of $293 million USD or $1.10 per share. Revenue came in at $9.76 billion USD, while adjusted EPS was $1.13, well ahead of analysts’ expectations of $1.04.
Same-store sales rose by 1.7%, the 11th consecutive quarter in which they have been in the green, which is a remarkable feat in the age of e-commerce. For the current quarter ending in January, Best Buy expects its per-share earnings to range from $2.65 to $2.75. Analysts surveyed by Zacks had forecasted adjusted EPS of $2.64. Best Buy said it expects to see revenue for the busy seasonal quarter in the range of $14.75 billion USD to $15.15 billion USD. BBY stock is currently up 9.4% following the forecast and could be set for an even better end to the week.
BBY Stock Up 200% in Five Years
With almost every traditional brick-and-mortar retailer feeling the pressure of Amazon’s (NASDAQ:AMZN) increasing dominance in the digital space, Best Buy has successfully implemented a strategy in recent years, which has seen it thrive under the pressure of the e-commerce boom. In the early days of the recent digitalized Black Friday buzz, Best Buy stores often acted as showrooms for consumers who would then make purchases online. The company has addressed this issue in recent years through partnerships with retailers, which have seen BBY stock climb 200% in five years.
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On Black Friday last year, consumers spent a record $5 billion USD in just 24 hours as the seasonal spending frenzy took hold. With an impressive suite of deals and forecast for high store traffic, BBY stock looks like it could be one of the biggest gainers this time round.
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