Highlights

  • Best Buy has 65.71% basic EPS growth, a P/E of 16.61 and PEG of -12.97.
  • Second quarter fiscal 2027 net earnings were $315 million, against $186 million.
  • Revenue was $9,779 million, with comparable sales up 4.1%.
  • Best Buy repurchased $37 million of shares; $3.0 billion remains authorized.

One-year earnings growth of 65.71%, paired with a trailing twelve-month P/E of 16.61 and an expected-basis PEG of -12.97, puts Best Buy (NYSE:BBY) among undervalued growth stocks, with shares trading at USD 97.13 on October 28, 2026, down 1.39%. In its latest disclosures, the omnichannel technology retailer recorded $34 million of tariff refunds in the second quarter of fiscal 2027 after a February 20 U.S. Supreme Court decision, received an additional $41 million refund on September 2, and filed a Form 10-Q on September 4 showing second quarter net earnings of $315 million.

Best Buy is based in Richfield, Minnesota, and incorporated in Minnesota. It describes its purpose as enriching lives through technology, serving customers online, in stores and at home. It has two reportable segments: Domestic, which covers its U.S. operations and Best Buy Health, and International, which covers its operations in Canada. At August 1, 2026, it had 1,068 stores in total. Its fiscal year ends on the Saturday nearest the end of January.

Growth: Second Quarter Fiscal 2027 Earnings, Revenue and Segments

Net earnings were $315 million in the second quarter of fiscal 2027 against $186 million a year earlier, and $591 million for the first six months against $388 million. Basic earnings per share were $1.49 against $0.88, and diluted earnings per share were $1.48 against $0.87. The company said the increase in diluted earnings per share was primarily due to higher operating income. Adjusted diluted earnings per share, a non-GAAP measure, were $1.47 against $1.28.

Revenue was $9,779 million against $9,438 million, up 3.6%, and comparable sales rose 4.1%. Operating income was $421 million against $251 million, with restructuring charges of negative $6 million against $114 million, which the company described as adjustments to previously planned organizational changes.

Domestic revenue was $9,070 million, up 4.3%, with comparable sales growth in computing, home theater, AI glasses and trading cards, partly offset by a decline in traditional gaming. International revenue was $709 million against $740 million, down 4.2%, with comparable sales down 1.8%.

Valuation: P/E of 16.61, PEG of -12.97 and Cash Generation

The P/E ratio of 16.61 is measured on trailing twelve-month earnings, and the PEG ratio of -12.97 on expected growth. Net cash provided by operating activities was $1,296 million for the first six months against $783 million, which the company attributed primarily to the timing and volume of inventory purchases and payments.

The Domestic gross profit rate was 24.0% against 23.4%, which the company tied primarily to growth in Best Buy Marketplace and Best Buy Ads and the $34 million of tariff refunds. Adjusted operating income, a non-GAAP measure, was $417 million against $369 million.

Capital Returns, Debt and Liquidity

Best Buy has a $5.0 billion share repurchase program approved February 28, 2022, with no expiration date and $3.0 billion remaining at August 1, 2026. It repurchased 0.4 million shares for $37 million in the second quarter, against 2.5 million shares for $167 million in the first six months of the prior year. The regular quarterly dividend was $0.96 per share against $0.95, and dividends paid were $203 million in the quarter and $405 million for the six months.

Cash and cash equivalents were $2,255 million at August 1, 2026, against $1,738 million at January 31, 2026. The company had $500 million of notes due October 1, 2028, and $650 million due October 1, 2030, with $1.25 billion of undrawn capacity under its credit facility agreement.

Disclosed Risks and Outlook for Fiscal 2027

Selling, general and administrative expenses were $1,923 million against $1,829 million, and Domestic adjusted SG&A rose primarily on higher compensation, Marketplace and Ads expense, and advertising. International adjusted operating income was $13 million against $18 million. The company said tariff and trade policy developments continue to evolve and that it cannot predict their ultimate effect. Its filing notes that it has made accruals for legal proceedings where appropriate.

On the second quarter fiscal 2027 call, management said product costs have been increasing, including memory costs in computing, and that computing growth is expected to slow in the second half as the company laps Windows 10 end-of-support tailwinds.

The company raised its fiscal 2027 guidance on the call: revenue of $42.3 billion to $42.8 billion, comparable sales growth of 1.9% to 3%, an adjusted operating income rate of 4.4% to 4.5%, adjusted diluted earnings per share of $6.70 to $6.90 and capital expenditures of approximately $750 million. For the third quarter, it expects comparable sales growth of 1% to 3% and an adjusted operating income rate of approximately 4.1% to 4.2%.