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Why NYSE:BBY qualifies as a good dividend investing stock.

By Mill Chart

Last update: Apr 9, 2024

BEST BUY CO INC (NYSE:BBY) is a hidden gem unveiled by our stock screening tool, featuring a promising dividend outlook alongside solid fundamentals. NYSE:BBY demonstrates decent financial health and profitability while ensuring a sustainable dividend. Let's break it down further.

Understanding NYSE:BBY's Dividend

ChartMill assigns a proprietary Dividend Rating to each stock. The score is computed by evaluating various valuation aspects, like the yield, the history, the dividend growth and sustainability. NYSE:BBY was assigned a score of 7 for dividend:

  • BBY has a Yearly Dividend Yield of 4.76%, which is a nice return.
  • BBY's Dividend Yield is rather good when compared to the industry average which is at 3.31. BBY pays more dividend than 95.20% of the companies in the same industry.
  • BBY's Dividend Yield is rather good when compared to the S&P500 average which is at 2.36.
  • On average, the dividend of BBY grows each year by 15.34%, which is quite nice.
  • BBY has been paying a dividend for at least 10 years, so it has a reliable track record.
  • As BBY did not decrease their dividend in the past 5 years, we can say the dividend looks stable.

Unpacking NYSE:BBY's Health Rating

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NYSE:BBY has received a 5 out of 10:

  • An Altman-Z score of 4.40 indicates that BBY is not in any danger for bankruptcy at the moment.
  • BBY has a Altman-Z score of 4.40. This is amongst the best in the industry. BBY outperforms 86.40% of its industry peers.
  • BBY has a debt to FCF ratio of 1.73. This is a very positive value and a sign of high solvency as it would only need 1.73 years to pay back of all of its debts.
  • Looking at the Debt to FCF ratio, with a value of 1.73, BBY is in the better half of the industry, outperforming 74.40% of the companies in the same industry.
  • BBY has a Debt/Equity ratio of 0.38. This is a healthy value indicating a solid balance between debt and equity.

Profitability Assessment of NYSE:BBY

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NYSE:BBY was assigned a score of 7 for profitability:

  • BBY's Return On Assets of 8.29% is fine compared to the rest of the industry. BBY outperforms 77.60% of its industry peers.
  • BBY has a better Return On Equity (40.65%) than 89.60% of its industry peers.
  • The Return On Invested Capital of BBY (19.06%) is better than 88.00% of its industry peers.
  • BBY had an Average Return On Invested Capital over the past 3 years of 25.19%. This is significantly above the industry average of 14.66%.
  • The 3 year average ROIC (25.19%) for BBY is well above the current ROIC(19.06%). The reason for the recent decline needs to be investigated.
  • With a decent Profit Margin value of 2.86%, BBY is doing good in the industry, outperforming 63.20% of the companies in the same industry.

Every day, new Best Dividend stocks can be found on ChartMill in our Best Dividend screener.

For an up to date full fundamental analysis you can check the fundamental report of BBY

Disclaimer

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.

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BEST BUY CO INC

NYSE:BBY (5/24/2024, 7:15:55 PM)

After market: 71.6 +0.1 (+0.14%)

71.5

+1.87 (+2.69%)

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