Best Buy Likely to Post In-Line EPS, Morgan Stanley Says

MT Newswires Live11-20

Best Buy (BBY) is likely to report a modest comp miss but an in line earnings per share in Q3 following weak industry data for September and October, Morgan Stanley said in a Monday report.

"We think market expectations are for a down -3% to -2% domestic comp,

which is below consensus and company guidance of -1%," the report said.

The note also said that Best Buy could still report an in-line EPS but gross margin tailwinds are fading. It expects gross margin expansion of 23 basis points, slightly below consensus of 27bps.

Morgan Stanley does not expect any change to the firm's fiscal 2024 guidance at this point. It has an equal-weight rating on the stock and $105 price target.

"Valuation has rerated significantly over the past 12 months, which, combined with uncertainty around tariffs, and the holiday season still to play out, give us pause," the report said.

Price: 87.56, Change: -1.44, Percent Change: -1.62

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