Is Best BUY Co Inc (BBY) a good stock to buy?
Everything we have tested points the right way. That is a reason to look closer, not a reason to buy — these are frequencies about groups of companies in the past, not a statement about this one.
What each rating means, in numbers
Can it survive? — Very safe. Safer than 91% of the companies we cover, judged on the warning signs that came before companies that really did fail.
Cash it pays you — Fair. For every $100 of share price, the business threw off about $5.2 of spare cash last year. Higher is better: the cheap fifth on this measure ran about 7.7 points a year ahead of the dear fifth, 2011 to 2025.
Business quality — Strong. Passes 7 of the 9 health checks we can measure — things like making a profit, turning it into cash, and not piling on debt. Across 131,000 company-quarters the weakest scorers went on to fail at 5.4% against 1.4% for the strongest, in every era and all twelve sectors.
How wild is the price? — Average. The share price swings about 39% in a typical year, which puts it in the middling. Out of every 100 companies that swung like this, about 1.5 went bankrupt within the year. Across the three periods we tested that ran from 0.2% to 3.0%.
What "tested" means here, and why there is no score out of 100
Tested means the read was measured against what actually happened afterwards, on a history that keeps the companies that were later delisted, using only figures that had been filed on the day they are used. Survival was ranked on companies that really did fail. What an owner keeps was tested across the universe from 2011 to 2025.
The full record of everything we have tested is on the research pages.
Which benchmark. Over the period we tested, the median listed company returned +5.8% a year while the S&P 500 returned about +13.9% — the index is weighted by size and was carried by a handful of enormous winners. So "beats the index" and "beats the other companies you could have bought" are different questions. Where a read says it picks better companies, it means the second one. None of these gets you an index fund's return, and we would rather say that than imply otherwise.
The quality read is the strongest thing we have tested: 131,000 company-quarters across 5,300 companies, where the weakest scorers went on to fail at 5.4% against 1.4% for the strongest, holding in every era and all twelve sectors. It still says less likely to break, not likely to beat the market — every band in that study lost to the index at the median, because the median listed company does.
Each read is shown on its own rather than merged into a single score, so you can see which part is strong and which is weak instead of taking an average on trust.
▾ What goes into the smart-money reading
Contributions (weight × component score) sum to the total. This near-term score now includes fundamental health (leverage, FCF trend, DCF applicability). See the Financial Health section for the full balance-sheet read.
Chance the S&P 500 falls 10% or more in the next three months.
Counted from every day since 2006. Says nothing about BBY — see the board for how it is measured.
📍 Where to start on this page, and what to look at first
How to read BBY
A profitable, cash-generating business — our discounted-cash-flow estimate is the primary lens, cross-checked against what growth the price implies and against peers.
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1
The verdict + intrinsic value (our DCF) ↓
Our estimate of what a share is worth, versus today's price.
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2
Reverse-DCF + the interactive calculator ↓
See the growth the price assumes, then flex every assumption yourself to pressure-test it.
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3
Football field + peers ↓
A cross-check across methods and against comparable companies.
Is Best BUY Co Inc (BBY) overvalued?
Macro: Neutral / mid-cycleAbout fairly priced: within 5% of what we think the business is worth.
BBY trades at $87.01 vs an estimated
intrinsic value
of $85.63
— a 1.6% gap.
Today's price is consistent with BBY's owner-earnings free cash flow per share growing about 4.5% per year 5-YR · SCENARIO PATH over the next 5 years (the
price-implied growth rate).
Our DCF projects
modeled growth
of 4.0% per year based on history + sector defaults
(analyst consensus estimates not yet integrated).
TESTED · OURS HAS BEEN CLOSER
When we and the market have disagreed about growth, our number has been the closer one — a median miss of 4.8 points a year against the market's 8.3, measured on 3,279 past filings. That does not make a large gap a sell signal: we tested that too, and companies where the market expected far more than we did went on to return within 1.5 points of everything else. Treat the gap as a description of what the price assumes, not as a prediction. How this was tested →
Note: this is a 5-year, per-share view. The Reverse-DCF section below asks the same question over the same five years on a free-cash-flowFree Cash Flow (FCF) — Operating cash flow minus capital spending: cash left after a company covers operating costs, taxes and interest and reinvests in the business — but BEFORE repaying debt principal or paying dividends. The cash actually available to investors.
Why it matters: A company can show big profits on paper while burning through cash. FCF is what actually fills the bank account.
Reference: Healthy mature businesses convert 8–15% of revenue into FCF · Growth companies often negative
Full explanation → basis, as a single flat rate — so its number is close but not identical.
▾ Exactly how this 5-year figure is computed
Current price: $87.01 (live)
Discount rate: 9.6%; terminal growth: 3.0%
Forecast: 5 years explicit growth, then a linear fade to terminal; end-of-period cash flows discounted to today
Growth path: the model's scenario-weighted path (conservative 40% / base 35% / optimistic 25% — assumed weights, not measured probabilities) — see the "Three Scenarios, Weighted" table below for the three IVs
Method: solve for the constant 5-year per-share growth rate that, run through this same structure, makes the intrinsic value equal today's price. (The figure below solves the same five years as a single flat rate with no scenario weighting — hence a slightly different number.)
Not investment advice. The model can be wrong. Verify the assumptions in the sections below and consider consulting a licensed advisor for significant decisions.
What return would BBY pay as a bond?
Treat the share as a bond: the "coupon" is the cash an owner could take out this year, and unlike a real bond that coupon can grow. Fix today's price and a conservative growth path, and the only unknown left is the return. That number is comparable across every kind of company — which is the point.
Plainly: at $87.01, BBY pays a 5.2% owner-earnings coupon today. If that coupon grows 4.0% a year for five years and then settles toward 2.5%, and a buyer in year 10 pays 15× that year's owner earnings, the whole trade returns about 7.2% a year — 2.0 points more than a Treasury with none of the business risk. By year 5 the coupon on today's price would be 6.4% (the "yield on cost" Buffett talks about). Our DCF demanded 9.6% for a business this risky; this read falls short of that bar, which is the same conclusion the verdict above reaches by a different route.
Who owns BBY, and how it moves
From the SEC's own filings: every fund manager over $100M reports its holdings each quarter, and every officer and director reports theirs. Each point is what was public at the time.
868 institutions reported holding it at the latest quarter-end.
Safer than 91% of the stocks we cover
What this rating means, and what it does not
What this rank is — Very safe. Safer than 91% of the companies we cover. Out of every 100 companies ranked here, about <0.1% went bankrupt within the year, against 0.6% for the average company we cover. The rank comes from a model trained on every US filing since 2012, including 823 companies that really did fail, and scored each year by a version that had not seen that year.
What it is not — Not a trade. We tested shorting these names and buying puts, spreads, straddles and condors on them at real option prices, 2010-2025. Every version lost money: the market already prices the distress and the survivors squeeze. A high rank is a reason to read the filings and to size for a total loss, not a reason to bet against the company. A low rank says the balance sheet is calm, not that the price is sensible.
▾ The numbers, the logic, and why not to trade on it
The logic. A model trained on every US filing since 2012 — including 823 companies that went bankrupt or stopped trading under a dollar — ranks each covered stock by its chance of failing in the next year, from its latest filing, price history and credit conditions. The rank is a position among peers; the table is a count of what happened to stocks in each position, scored each year by a model that had not seen that year.
| Rank band | went bankrupt within 12 months | fell 80% or more (or failed) within 12 months | fell 50% or more (or failed) within 6 months |
|---|---|---|---|
| All covered stocks (average) | 0.59% | 4.21% | 8.51% |
| Retail & wholesale (sector average) | 1.00% | 4.04% | 7.74% |
| riskiest 1% | 16.4% | 33.0% | 45.5% |
| next 2% (97-99) | 5.9% | 24.9% | 38.2% |
| next 2% (95-97) | 3.4% | 21.2% | 33.8% |
| next 5% (90-95) | 1.6% | 15.1% | 27.3% |
| next 15% (75-90) | 0.8% | 8.5% | 17.8% |
| next 25% (50-75) | 0.2% | 2.7% | 6.2% |
| safest half ← this stock | <0.1% | 0.5% | 2.1% |
Why not to trade on it. We tested shorting these names and buying puts, spreads, straddles and condors on them at real option prices, 2010–2025: every version lost money. The market already prices the distress, and the survivors squeeze. Use a high rank to read the filings and to size for a total loss — not to bet against the company. A low rank says the balance sheet is calm, not that the price is sensible.
Scored from the filing of 2026-06-08; table generated 2026-09-18. Within Retail & wholesale: rank 15 of 100. Rough one-year odds for this stock alone: bankruptcy 0.1%, an 80% fall 0.4% (the model overstates the middle of the range).
▾ The logic, and why not to buy on it
The logic. Trained on 2,900 acquisitions since 2012, the model leans on size (small), age, retained earnings, asset growth, volatility and how many deals the sector has just seen. Announcement = the day the stock jumped, not the day the paperwork was filed.
| top 1% | 15.4% acquired within a year |
| next 2% (97-99) | 10.3% acquired within a year |
| next 2% (95-97) | 9.0% acquired within a year |
| next 5% (90-95) | 7.3% acquired within a year |
| next 15% (75-90) | 6.4% acquired within a year |
| next 25% (50-75) | 4.8% acquired within a year |
| bottom half ← this stock | 3.0% acquired within a year |
Why not to buy on it. A takeover paid a median +22% on the day — but even in the top band about 6 in 7 companies are not bought, and those lag. Buying the whole top list returned what the S&P 500 did (2012–2023), and adding "cheap" or "beaten-down" filters did not change that. Read it as context for a thesis you already have, never as the thesis.
Who expects what from BBY
The price implies one growth rate and our model produces another — and both have been scored against what actually happened. Beside them: how the analysts covering this company rate it, and how accurate their earnings estimates have proved.
What each number is, and which has been tested
The market — 4.5% over 5 years. The growth implied by today's price. Tested: median miss of 8.3 points a year against realised five-year growth.
Us — 4.0% over 5 years. Tested across 3,279 past filings: a median miss of 4.8 points a year against realised five-year growth, better than both the market and a naive carry-forward.
Analysts (their record here) — Roughly right. Over the last 4 quarters, the consensus earnings estimate for this company missed by a median of 5.5% either way, and ran too LOW, so the company kept beating on average (4 beats, 0 misses). This is NEXT-QUARTER earnings, which companies guide analysts toward - they are supposed to be good at it. It says nothing about long-run growth, which nobody guides.
Analyst data from Finnhub, snapshotted recently. Their forward estimates are behind a paywall we have not bought, so what is shown is their rating and their measured track record on this company — not their forecast. Nothing here is used anywhere in our valuation: feeding an unscored forecast into the model would undo the one growth result we have actually tested.
What growth must the market believe? Reverse DCF — Instead of asking "what is this stock worth?", asks "what growth rate is the current market price already assuming?"
Why it matters: It crystallizes the bull thesis as a single number you can argue with. If the market expects 40% growth for 10 years and you do not believe that, the stock is overvalued.
Reference: 10–15% = sustainable for strong companies · 20–25% = exceptional · 30%+ = historically very rare
Traditional DCF asks "what is this stock worth?" Reverse DCF flips it: it treats today's price as correct and solves for the growth rate that justifies it. In plain terms — if our model is right about everything else, the company's cash flow would have to grow (or shrink) by this much every year for the next 5 years for today's price to make sense. If that required growth looks unrealistic, the price is stretched; if it looks easy to beat, the price may be cheap.
Why it matters: A company can show big profits on paper while burning through cash. FCF is what actually fills the bank account.
Reference: Healthy mature businesses convert 8–15% of revenue into FCF · Growth companies often negative
Full explanation → must grow at:
▾ Exactly how this 5-year figure is computed
Forecast length: 5 years at the solved rate, then a linear fade to terminal growth over years 6-10 — the same shape the DCF above uses
Terminal growth after the fade: 3.0%
Discount rate: 9.6% (the rate the model used)
Price used: $87.01 — the live price shown on this page (not frozen)
Method: solve for the constant annual growth rate that makes the discounted 10-year FCF stream + terminal value equal today's price.
Almost any healthy business should clear this bar over five years.
For reference: A low bar — most financially healthy companies clear this comfortably.
▾ How we computed this · Reality check thresholds · Assumptions
- Starting FCF/share: $5.28 (TTM)
- Discount RateDiscount Rate — The annual return you demand for taking single-stock risk instead of buying a safe Treasury or index fund.
Why it matters: Higher discount rate = stricter valuation (a stock has to produce more cash to be worth holding). Lower = more generous.
Reference: 8–12% is standard · 9–10% matches S&P 500 historical return · Below 7% is illogical for single-stock risk
Full explanation →: 9.6% — standard 8-12%; 9-10% matches S&P 500 historical return - Terminal Growth RateTerminal Growth Rate — The growth rate we assume the company holds forever, after the explicit 10-year forecast period ends.
Why it matters: It anchors the long-tail value. Cannot mathematically exceed long-term GDP growth or the company eventually becomes larger than the global economy.
Reference: 2–3% (matches long-term US GDP growth) · Above 4% is mathematically problematic
Full explanation →: 3.0% — matches long-term GDP growth - Forecast horizon: 10 years explicit + terminal perpetuity
| ≤ 0% | Priced for decline — likely undervalued OR dying business |
| 5-12% | Reasonable; sustainable for quality businesses |
| 12-18% | Demanding — strong execution required |
| 18-25% | Exceptional — few companies sustain for a decade |
| 25-35% | Heroic — historically very rare |
| 35%+ | Borderline impossible at scale |
Sustaining 30%+ cash-flow growth for a full decade at scale is exceedingly rare — the bar is brutally high.
Use the interactive calculator below to change the discount rate, growth and terminal-growth assumptions and watch the value move.
What this rating means
What the rating says — Inside every range. The current price sits inside each method's range — roughly fair on this blended view.
What it does not say — Not a forecast. This shows where today's price sits against several different ways of valuing the business. Where the methods disagree, the spread itself is the useful part - it tells you how much the answer depends on which one you trust.
Football field: where does the price sit?
Different valuation methods produce different fair-value ranges depending on assumptions. Plotting them together lets you see at a glance whether the current price is reasonable across approaches, or only one specific lens.
Industry multiples sourced from: broad market average (sector unknown). See the Peer Basket section below for the peer comparison and its limited-comparables caveat.
⚠ We found no genuine same-industry (Radio, Tv & Consumer Electronics Stores) comparables at all — fewer than the 4 we require for a reliable median. The 8 names in the table below therefore include 8 broader Consumer Cyclical names marked fallback, whose business models and margins differ — which is why any median below is computed over that wider set, not over true comparables. So we do not derive a peer-implied share value here. Read the multiples as rough context only.
How does BBY stack up against its closest peers?
Ideally we compare BBY only to same-industry peers, but too few exist in our universe right now, so the basket below mixes in broader-sector names. Treat the multiples as rough context, not a valuation. For a leveraged business, EV/EBIT and FCF yield (both in the table) are usually more reliable than EV/Sales, because revenue multiples ignore differences in margins and debt.
▾ What's "EV / Sales" in plain English?
EV (Enterprise Value) = market cap + total debt − cash. It's "what you'd pay to buy the entire company outright" — you pay the market cap to shareholders and take over their debt, but you keep their cash. EV is fairer than market cap alone because it includes the debt the new owner inherits.
EV / Sales = EV ÷ annual revenue. So "2.5×" means investors pay $2.50 of enterprise value per $1 of yearly sales. Higher = market is paying more per dollar of sales (usually because they expect future growth or fat margins).
p25 / median / p75 are the 25th, 50th (middle), and 75th percentile of the peers' multiples. Half the peers fall between p25 and p75. The median (p50) is the typical peer — that's the benchmark we compare to.
| EV / SalesEV / Sales — For every $1 of yearly revenue, this is how many dollars investors pay to own the whole business (including debt). Why it matters: Works for pre-profit growth companies where P/E and FCF don't apply. The most apples-to-apples cross-company multiple because it ignores accounting choices. Reference: 1–3x for mature companies · 4–10x for software/SaaS · 10–20x for hypergrowth · >20x is rare and demanding Full explanation → |
1.3x / 1.8x / 5.4x |
| EV / Gross ProfitEV / Gross Profit — Enterprise value divided by gross profit — the multiple paid for what each dollar of sales contributes after direct costs. Why it matters: More refined than EV/Sales for high-margin businesses (software, marketplaces) where gross margin is the real economic engine. Reference: 8–15x for SaaS · 15–25x for hypergrowth software · >30x demanding Full explanation → |
4.3x / 10.5x / 17.0x |
| EV / EBITEV / EBITDA — Enterprise value divided by earnings before interest, tax, depreciation, and amortization. Why it matters: A classic "what would a private buyer pay" multiple — used in M&A. Strips out tax and capital-structure noise. Reference: 8–12x for mature businesses · 15–25x for growth · Below 5x often signals distress Full explanation → |
11.5x / 19.8x / 22.8x |
Bold middle number = median peer. Half the peers trade above it, half below. Computed over 8 peers (broad — see caveat); implausible multiples excluded.
⚠️ Important caveat: peer multiples only work if the peers are genuinely comparable. Always check the peer list below — if the auto-picker grabbed micro-caps or unrelated businesses, the comparison is noise. A medical-device giant priced against tiny biotech startups won't produce a useful signal.
▾ View peer list (8)
| Ticker | Company | Industry | Mcap | EV/Sales | EV/GP | EV/EBIT | FCF Yield |
|---|---|---|---|---|---|---|---|
| ZKH | ZKH Group Ltd | Building Materials Retail ·fallback | $15.9B | — | — | — | — |
| YUMC | Yum China Holdings, Inc. | Restaurants ·fallback | $14.8B | 1.3x | — | 11.5x | 5.1% |
| STLA | Stellantis N.V. | Auto Manufacturers ·fallback | $13.4B | 0.4x | — | — | 68.5% |
| W | Wayfair Inc. | E-Commerce ·fallback | $12.7B | 1.3x | 4.3x | 941.6x | 1.0% |
| TXRH | Texas Roadhouse, Inc. | Restaurants ·fallback | $10.8B | 1.8x | — | 22.8x | 2.7% |
| WMS | ADVANCED DRAINAGE SYSTEMS, INC. | Plastics Foam Products ·fallback | $10.7B | 4.0x | 10.5x | 19.8x | 4.9% |
| VFS | VinFast Auto Ltd. | Auto Manufacturers ·fallback | $8.2B | 5.4x | — | — | 0.3% |
| MAT | MATTEL INC /DE/ | Sporting Goods & Toys ·fallback | $41.9B | 8.3x | 17.0x | 81.0x | 1.1% |
Bankruptcy + quality screens
Cheap stocks can be cheap for a reason. These screens warn when a low valuation comes paired with structural fragility.
What these health ratings mean, in numbers
Business quality — Strong. Passes 7 of the 9 health checks we can measure — making a profit, turning it into cash, not piling on debt, not issuing shares. Across 131,000 company-quarters the weakest scorers went on to fail at 5.4% within a year against 1.4% for the strongest, and that held in every era and all twelve sectors. It says "less likely to break", not "likely to beat the market".
Bankruptcy score (Altman Z) — Very safe. Altman Z is 4.42. It combines working capital, retained earnings, operating profit and market value against total assets into one bankruptcy score. Above 3.0 is the safe zone, 1.8 to 3.0 is grey, below 1.8 is the distress zone. It was calibrated on manufacturers in 1968, so it reads asset-light and heavily-financed businesses badly — which is why it is one input here and never the verdict.
Why it matters: Cheap-looking stocks (low P/E or P/B) often have low Z-scores because the market knows the company is dying. Z-score warns you before you fall into a value trap.
Reference: > 3.0 = safe zone · 1.81–3.0 = grey zone · < 1.81 = distress zone
Full explanation →
Safe zone under the classic Altman thresholds — companies scoring here have historically gone bankrupt only rarely within ~2 years. A screening signal, not a guarantee.
The classic Z-score was calibrated on manufacturers. It is less reliable for asset-light or non-manufacturing businesses (broadcasters, media, software, services) and not applicable to banks, REITs, or insurers — for those the coefficients and the asset-turnover term distort the result. Read it as one screening input, not a verdict.
Why it matters: High score = fundamentals improving. Low score = deteriorating. Especially powerful for filtering cheap stocks: cheap + high F-score historically outperforms; cheap + low F-score is often a value trap.
Reference: 7–9 = strong · 4–6 = mediocre · 0–3 = weak
Full explanation →
▾ The checks — what passed, what didn't (and what we couldn't measure)
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✓ Positive net incomeNet income $1,069.0M in FY2026.
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✓ Positive operating cash flowOperating cash flow $1,962.0M (was $2,098.0M the prior year).
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✓ Cash flow backs up reported profitOperating cash flow $1,962.0M vs net income $1,069.0M.
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✓ Return on assets improvingReturn on assets 7.3% vs 6.3% a year ago.
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✗ Debt load (vs assets)Long-term debt is 7.9% of assets vs 7.7% a year ago ($1,165.0M of $14,670.0M assets).Why this matters: Rising debt relative to assets means more risk and more cash going to interest instead of shareholders. Falling debt is a sign of strengthening.
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✓ Short-term liquidity (current ratio)Current ratio 1.11x vs 1.03x a year ago.
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✓ Share count (dilution)Share count declined 2.0% (215.2M → 211.0M year-over-year), so the no-dilution check passed. (One-year change; the multi-year buyback pace can differ.)
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✗ Pricing power (gross margin)Gross margin 22.5% vs 22.6% a year ago.Why this matters: Rising gross margin means stronger pricing power or lower input costs — a sign of competitive strength. Falling margin signals pressure.
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✓ Sales per asset (asset turnover)Asset turnover 2.84x vs 2.81x a year ago.
Missing data is never counted as a pass or a fail — it's shown as n/a and excluded from the denominator. Each check compares the company against its own prior year.
What if you assume different inputs?
Here's where we land — and what happens if you change the assumptions. Drag the sliders to set your own Discount RateDiscount Rate — The annual return you demand for taking single-stock risk instead of buying a safe Treasury or index fund.
Why it matters: Higher discount rate = stricter valuation (a stock has to produce more cash to be worth holding). Lower = more generous.
Reference: 8–12% is standard · 9–10% matches S&P 500 historical return · Below 7% is illogical for single-stock risk
Full explanation → (the annual return you demand for single-stock risk) and terminal growth; the value updates live so you can see whether the stock looks cheaper or richer. The discount rate starts at 9.6%, the figure our model used for BBY. Open Advanced to also change beta, growth and the rate path.
Note: the calculator opens at our published value of $85.63 — it is initialised to the same scenario-weighted result, so the two match exactly on load. The moment you move a slider, the value below becomes a single-path what-if at your assumptions (not the three-scenario weighting), which is why it can differ from the headline once you've touched it.
9.7% — beta-based (CAPM), from this stock's BetaBeta — How much the stock moves when the overall market moves. 1.0 = moves with the market; 1.5 = moves 50% more than the market.
Why it matters: Higher beta = more volatile = should demand higher discount rate. Low beta stocks (utilities, consumer staples) move less.
Reference: Most stocks 0.5–1.5 · Defensives ~0.3 · High-vol tech ~1.5–2.0
Full explanation → of 0.95. The safe Treasury rate plus a premium scaled by how much more (or less) volatile the stock is than the market.
9.5% — sector/quality tier. A simpler hurdle set by industry and business durability: lower for stable, wide-moat companies; higher for speculative or micro-caps.
The headline value and this calculator start at 9.6% — the mid-point of the two (we use the more conservative sector/quality rate when model applicability is limited or the balance sheet is stretched). Drag the slider to the other rate to see the full range.
+1.6%
At the default assumptions the flat path lands near our published value of $85.63. Move any slider to recompute it with your own.
Move any slider above to recompute this against your own assumptions.
⚙ Advanced — tinker with every input (beta, growth, rate path, margin → full intrinsic value)
BBY is fairly valued, with the price being 1.6% above intrinsic valueIntrinsic Value — Our DCF model's estimate of what each share is mathematically worth based on projected cash flows.
Why it matters: Compare to current price. Below IV = potentially undervalued. Above IV = priced for growth that must actually happen.
Reference: Model-derived; quality depends on data and assumptions.
Full explanation → (a 1.6% premium). The market appears to be paying for the company's consistent profitability and positive operating cash flow, despite declining revenue. The biggest risk to our model's base assumptions proving too high is that the revenue decline of -5.3%/yr over 4 years continues or accelerates, impacting future free cash flowFree Cash Flow (FCF) — Operating cash flow minus capital spending: cash left after a company covers operating costs, taxes and interest and reinvests in the business — but BEFORE repaying debt principal or paying dividends. The cash actually available to investors.
Why it matters: A company can show big profits on paper while burning through cash. FCF is what actually fills the bank account.
Reference: Healthy mature businesses convert 8–15% of revenue into FCF · Growth companies often negative
Full explanation →.
As of 6 days ago
Anatomy of a share
What you're buying per share. Bars are at the same scale so you can see the relative size of revenue, costs, cash flow, and debt — not just read them in a table.
What's free cash flow / what do these mean?
Revenue per share — how much the business earns from customers, divided by the number of shares outstanding. Top of the income statement.
Earnings per share — profit left after operating costs, interest, and taxes, per share. Two versions appear on this page and are not interchangeable: GAAP diluted EPS uses the company's weighted-average diluted share count during the reporting period (this is the "earnings" in "price-to-earnings"); net income per current share divides annual net income by today's share count. They differ whenever the share count has changed.
Owner-earnings free cash flow per share — the cash the business produces for shareholders. Savng's owner-earnings FCF subtracts capital expenditures and stock-based compensation from operating cash flow (SBC is a real dilution cost even though it's non-cash). This is deliberately more conservative than "standard" FCF, which subtracts only capital expenditures — so our figure is lower than the headline FCF you'll see elsewhere. FCF funds dividends, buybacks, debt repayment, and acquisitions; a company can report positive earnings yet negative FCF.
Debt per share — total interest-bearing borrowings divided by shares. High debt-per-share next to thin FCF-per-share is a fragility signal.
What you actually need to decide
Every stock price is a disagreement. Here's the single thing that must go right for the bulls, the single thing that breaks the thesis, and the concrete signposts to watch so you can update your view as real results arrive.
- Stabilization or reversal of the revenue decline
- Maintenance of gross margins around 22.5%
- Continued positive operating cash flow generation
The trend, in plain numbers (FY2025 → FY2026, latest reported)
Straight from the financial statements — no model, no opinion. For a small or unprofitable company, the direction of these numbers usually tells you more than any single valuation.
- Net income grew +15% to $1.07B.
- Free cash flow fell to $1.12B.
Roughly flat: Revenue was flat +0% to $41.69B. · Gross margin held to 22% (0 pts).
Management & Leadership
Corie S Barry serves as the Chief Executive Officer, with Anne L Bramman as the Chief Financial Officer. Other key executives include Kathleen Scarlett, SEVP, CHRO, and Mathew Watson, SVP, Controller & CAO.
Chief Executive Officer
Chief Financial Officer
What They Make
Best Buy sells consumer electronics and related services. Their paying customers are individuals and businesses purchasing these products and services.
End Markets
Revenue Drivers
Why Is It Priced Like This?
Why Customers Pay
The market prices BBY at a premium of +1.6% to the model's intrinsic valueIntrinsic Value — Our DCF model's estimate of what each share is mathematically worth based on projected cash flows.
Why it matters: Compare to current price. Below IV = potentially undervalued. Above IV = priced for growth that must actually happen.
Reference: Model-derived; quality depends on data and assumptions.
Full explanation →, likely due to its consistent profitability (net income positive latest, profitable 5/5 yrs) and positive operating cash flow (positive 5/5 yrs). This suggests investors are willing to pay for a stable, cash-generating business despite the revenue declining by -5.3%/yr over the last four years.
Three Scenarios, Weighted
| Scenario | IV | Upside from today's price | Weight |
|---|---|---|---|
| Conservative | $73.50 | -15.5% | 40% |
| Base | $87.07 | 0.1% | 35% |
| Optimistic | $103.01 | 18.4% | 25% |
| Weighted | $85.63 | -1.6% | 100% |
Reading the last column: it is the move from today's price to each value (IV ÷ price − 1). The headline "premium/discount to model IV" measures the same gap from the value's side (price ÷ IV − 1), so the two percentages differ in size and sign by construction — e.g. a price 8% above value is a value 7.4% below price.
What has to be true (historical comparison)
To justify today's price, BBY's owner-earnings cash flow must grow to roughly 1.2× its current level over 5 years. If profit margins and share count stay roughly constant, that is equivalent to about the same multiple of revenue. Each card below is a real company that grew revenue at a comparable magnitude — possibly in a different industry; the point is the growth magnitude required and its historical base rate, not that BBY resembles these businesses. The green/amber line shows whether that company cleared or fell short of the bar, and the tag on the right shows how it actually fared afterward (succeeded, faded, or wiped out).
Lost $720M on $1.6B revenue. The market priced in dominance of online retail. Took 9 years for the share price to make a new high but ultimately compounded 170x in revenue.
Still losing money producing Model 3 at scale. Vehicle margins were below 20%. Stock 15x'd over the next four years as margins crossed into autos' best-in-class range.
What 'scale' looked like in 1999 for comparison purposes. Big and profitable. Revenue actually declined over the next 20 years.
Anchors are hand-curated 10-K snapshots. We surface the three whose 5-year revenue growth most-closely brackets the rate required to justify the current price. Source: SEC EDGAR.
Business Model & Valuation
How They Make Money
The company retires approximately 4.0%/year of its shares through buybacks, and maintains a stable long-term debt of $1.2 billion.
Free Cash Flow DCF High
Owner-earnings FCF DCF: positive free cash flow (operating cash flow − capex − stock-based comp) in a sector suited for cash-flow-based valuation.
Show advanced inputs
| Revenue Growth | -5.3% |
| Eps Growth | -15.4% |
| Historical Fcf Growth | -17.1% |
| Sector Default | 8.0% |
| Sector Default Source | Consumer Cyclical sector default |
| Best Estimate | 4.0% |
| Method | blend(30% revenue_cagr, 70% sector) (buybacks ~4%/yr: per-share support, not added to growth) |
| Growth Basis | total |
| Business Growth | 4.0% |
| Buyback Rate | 4.0% |
What this model does NOT do: this is a consolidated owner-earnings FCF model. Standalone segment assumptions: none. It does not project same-store sales, store/showroom count and gross margin independently; their combined effect is embedded in the historical revenue and cash-flow trend the model extrapolates. The calculator above can only approximate a segment's impact through the single consolidated growth rate — it cannot model any one line separately. For a true segment-level view, build a separate model from the company's segment disclosures.
Maturity & Competitive Position
Moat Signals
Revenue has been declining at -5.3%/yr over the last four years, from $51761M to $41.7 billion.
Geography & Markets
Best Buy is a US-headquartered company, though specific geographic revenue mix is not available from current data sources.
Geographic Risks
Market Signals
These are timing signals, not value signals — they describe the stock's recent price behavior, not what the business is worth. Use them for the "the thesis looks good, but is now the moment?" question. Each tile below explains what it's saying.
Why it matters: Short-term contrarian indicator. Extreme readings often precede mean reversion, though not always.
Reference: 30–70 normal · >70 overbought · <30 oversold
Full explanation → (14)46.6NeutralMomentum is balanced — neither overbought nor oversold.
Why it matters: When the fast line crosses above the slow line, short-term momentum is turning up; below, turning down. A timing cue, not a value signal.
Reference: Line above signal = bullish momentum · below = bearish
Full explanation →BearishLine below signalThe fast trend is below the slow trend — short-term momentum is currently downward.
Technicals describe price, not the business. A great company can have a "bearish" tape (a buying chance) and a weak one a "bullish" tape (a trap). Pair these with the valuation and health sections above.
QUALITY
Data Quality & Risk Flags (1 notes — click to expand/collapse)
Guardrail Notes (1)
- The company retires ~4%/yr of its shares (a multi-year CAGR), but we do NOT add that to the growth rate: buybacks at fair value are value-neutral per current share, and adding them would double-count the same cash the DCF already values. We also do not model future buyback ACCRETION: repurchases below intrinsic value CAN raise value per remaining share, but only if they continue, are funded after debt service, and are made below intrinsic value — excluding that potential benefit keeps the model conservative.
FINANCIALS
Financial Statements (5-year tables — click to expand)
From Best BUY Co Inc's SEC filings (EDGAR).
Income (5yr)
| Year | Revenue | Net Income | EPS |
|---|---|---|---|
| 2026 | 41.7B | 1.1B | $5.04 |
| 2025 | 41.5B | 927.0M | $4.28 |
| 2024 | 43.5B | 1.2B | $5.68 |
| 2023 | 46.3B | 1.4B | $6.29 |
| 2022 | 51.8B | 2.5B | $9.84 |
Cash Flow (5yr)
| Year | Operating CF | CapEx | − SBC | Free Cash Flow |
|---|---|---|---|---|
| 2026 | 2.0B | 704.0M | 139.0M | 1.1B |
| 2025 | 2.1B | 706.0M | 139.0M | 1.3B |
| 2024 | 1.5B | 795.0M | 145.0M | 530.0M |
| 2023 | 1.8B | 930.0M | 138.0M | 756.0M |
| 2022 | 3.3B | 737.0M | 141.0M | 2.4B |
How we define FCF: operating cash flow − capital expenditure − stock-based compensation (owner-earnings basis — SBC is a real cost to shareholders even though it's non-cash). Latest year: 2.0B − 704.0M − 139.0M (stock-based comp) = 1.1B. This is the same owner-earnings FCF definition the valuation model uses.
Balance Sheet
| Total Assets | 14.7B |
| Total Liabilities | 11.7B |
| Equity | 3.0B |
| Total Debt | 1.2B |
The questions people ask about BBY
Is Best BUY Co Inc (BBY) a good stock to buy?
Best BUY Co Inc (BBY) is priced about where our model puts it ($87.01 against $85.63). A good buy at a fair price depends on the business holding up: see the growth the price assumes, the financial-health checks and insider activity on this page. This is educational research from SEC filings, not investment advice.
Is Best BUY Co Inc (BBY) overvalued?
Best BUY Co Inc (BBY) trades at $87.01, within about 5% of our $85.63 estimate, so it looks fairly priced rather than overvalued or undervalued. This is educational research from SEC filings, not investment advice.
What is BBY's intrinsic value?
Our model estimates BBY is worth about $85.63 per share, built from the cash the business is expected to generate, taken from its SEC filings. The market price is $87.01.
What growth is priced into BBY?
Working backwards from today's price, the market is counting on roughly 3.8% a year growth in BBY's cash flow over the next decade. Compare that with the company's actual record on this page.
Where do these numbers come from?
From Best BUY Co Inc's own SEC filings (10-K and 10-Q), Form 4 insider filings and daily market prices. Every figure on the page links to how it was calculated, and the model's weak spots are listed next to its results.