Source: courtesy of Best Buy
Best Buy has become the retail rags-to-riches story over the past few years, as it not only has survived, but most of the big-box retailer’s competitors have gone to the graveyard and the company has grown the brand smartly. Best Buy continues to combat challenging conditions by reducing costs, pricing competitively, optimizing stores and enhancing distribution. The store-within-store partnerships it has with suppliers like Samsung, Apple and Google are continuing to drive more store traffic and product sales. Best Buy’s online channel growth also looks very promising, as it continues to battle Amazon. Rumors of its demise were frankly overblown.
The company is expected to grow 2015 earnings by a very solid 27%. One other huge tailwind for the electronics giant is lower gasoline prices that are continuing to put more money in consumers’ wallets. That could start to push discretionary buying even higher this year as wage growth also kicks in.
Earlier this quarter 24/7 Wall St. reported that this electronics retailer announced the closure of 66 of its Canadian Future Shop locations and eliminated approximately 500 full-time and 1,000 temporary jobs. An additional 65 Future Shop stores will be closed for a week as the company consolidates the stores under the Best Buy brand.
Revenue from the company’s international segment dropped 12.4% year-over-year in the fourth quarter to $1.51 billion, and same-store sales were down 4%. Best Buy completed the sale of its China business in February, leaving Canada as the company’s sole international market.
Shares of Best Buy were down 3.2% at $33.87 as the market was coming to a close Wednesday. The stock has a consensus analyst price target of $42.61 and a 52-week trading range of $24.71 to $42.00.
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