Best Buy (BBY) Stock Forecast & Price Target

Best Buy Co. has demonstrated strong financial performance, with 2024 consolidated sales surpassing $41 billion, solidifying its position as the largest pure-play consumer electronics retailer in the US and achieving approximately 8% market share in North America. The company's international gross margins improved by 46 basis points to 21.4%, and operating margins increased by 107 basis points to 5.7%, driven by reduced supply chain costs and gross margin enhancements. Additionally, domestic comparable online revenue rose by 2.6%, accounting for 39.5% of total revenue, while notable growth in the tablets and computing categories indicated a promising trend ahead, underpinned by innovative initiatives such as Totaltech that have fostered increased customer engagement and spending.

Best Buy Co. is experiencing challenges, with management guiding for slightly negative comparable sales in the first quarter and an anticipated adjusted EBIT margin of approximately 3.40%, indicating a potential double-digit decline year-over-year. The company's performance across major categories has been inconsistent, with significant declines in appliances, entertainment, and consumer electronics, which are being partially countered by growth in computing and mobile phones. Additionally, increased selling, general, and administrative expenses, alongside a forecasted decline in earnings per share for 2025, further underscore a cautious outlook on the company's financial performance.