Value
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 7.7 |
| P/S | 10.0 |
| EV/EBITDA | 6.8 |
| Fwd P/E | 8.6 |
| PEG | 4.8 |
| Analyst target | 3.0 |
- ▸Forward P/E: 13.3x
- ▸PEG: 1.70
BBY · Why this verdict
Why Best Buy Co. (BBY) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictHOLD
Overall score5.3/10
ConfidenceHIGH
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Best Buy earns a high return on equity (43%) and pays a 4.0% dividend, but the price is far above the analyst target, insiders are selling heavily and business quality is below average.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Return on equity is an excellent 43%, but the business has no competitive moat, so returns depend on execution rather than durable advantages. Quality breakdown | Return on equity stays above 30% over the next 12 months. | →Stable |
| CounterHigh ROE is partly a product of a small equity base, and without a moat retail margins can be competed away. | ||
The price of $95.65 is 17.3% above the $79.06 analyst target, leaving no consensus upside and 12.5% downside to the stop level. Warnings | Analyst targets are raised toward $95 as earnings support the current price. | ↓Deteriorating |
| CounterTrading well above the target and near the 52-week high (4.9% away) leaves little margin for an earnings disappointment. | ||
Insiders sold about $38.4M of stock in 90 days (0.192% of market cap) across 4 sales with no buys. Insider | Insider selling slows to under $10M over the next 90 days. | →Stable |
| CounterExecutive sales often reflect scheduled compensation and diversification rather than a negative view on the business. | ||
The stock trades at a forward P/E of 13.2x with a PEG of 1.70 and a 4.0% dividend, a fair but not cheap valuation. Valuation breakdown | Forward P/E stays below 15x while the 4.0% dividend is maintained over 12 months. | →Stable |
| CounterA PEG of 1.70 means growth is not cheaply priced, and the price is already above where analysts value the stock. | ||
Overall business quality is below average at 4.7, which has triggered a score penalty in a risk-off market. Bear case | Quality score rises above 5.5 as margins improve over 12 months. | ↓Deteriorating |
| CounterFalling on-balance volume points to distribution, and implied volatility of 68% signals market uncertainty. | ||
Return on equity is an excellent 43%, but the business has no competitive moat, so returns depend on execution rather than durable advantages.
→StableQuality breakdown
- Expectation
- Return on equity stays above 30% over the next 12 months.
CounterHigh ROE is partly a product of a small equity base, and without a moat retail margins can be competed away.
The price of $95.65 is 17.3% above the $79.06 analyst target, leaving no consensus upside and 12.5% downside to the stop level.
↓DeterioratingWarnings
- Expectation
- Analyst targets are raised toward $95 as earnings support the current price.
CounterTrading well above the target and near the 52-week high (4.9% away) leaves little margin for an earnings disappointment.
Insiders sold about $38.4M of stock in 90 days (0.192% of market cap) across 4 sales with no buys.
→StableInsider
- Expectation
- Insider selling slows to under $10M over the next 90 days.
CounterExecutive sales often reflect scheduled compensation and diversification rather than a negative view on the business.
The stock trades at a forward P/E of 13.2x with a PEG of 1.70 and a 4.0% dividend, a fair but not cheap valuation.
→StableValuation breakdown
- Expectation
- Forward P/E stays below 15x while the 4.0% dividend is maintained over 12 months.
CounterA PEG of 1.70 means growth is not cheaply priced, and the price is already above where analysts value the stock.
Overall business quality is below average at 4.7, which has triggered a score penalty in a risk-off market.
↓DeterioratingBear case
- Expectation
- Quality score rises above 5.5 as margins improve over 12 months.
CounterFalling on-balance volume points to distribution, and implied volatility of 68% signals market uncertainty.
Per-dimension breakdown
Quality
4.7/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 10.0 |
| ROA | 4.8 |
| Gross margin | 0.5 |
| Op margin | 1.6 |
| Net margin | 1.5 |
| Current ratio | 4.4 |
| FCF quality | 7.5 |
| Moat | 4.9 |
| Piotroski F | 6.7 |
- ▸Excellent ROE: 43%
- ▸No competitive moat
Growth
6.7/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 3.4 |
| EPS growth | 10.0 |
Momentum
4.3/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 1.9 |
| OBV | 1.0 |
| MA position | 9.0 |
| Volume | 4.1 |
- ▸Volume distribution (falling OBV)
- ▸Above 200-day MA
Sentiment
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 6.0 |
| Analyst rating | 5.0 |
| Price target | 4.0 |
Insider
3.4/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 3.0 |
| insider conviction | 2.0 |
| holder change | 5.3 |
- ▸Notable insider selling — $38,449,577 (0.191% of mkt cap)
Peer rank
5.1/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 6.7 |
| quality rank | 4.9 |
| growth rank | 3.9 |
Technical
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 4.8 |
| support resistance | 4.0 |
| 52w position | 8.7 |
Risk (lower is worse)
4.5/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 5.5 |
| days to cover | 5.4 |
| volatility | 3.0 |
| put call | 4.0 |
| implied vol | 4.1 |
| max pain risk | 3.0 |
| beta | 6.2 |
| debt equity | 4.4 |
- ▸Above max pain $74
Catalyst
5.9/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 5.4 |
| dividend safety | 4.8 |
| news activity | 5.0 |
- ▸Perfect beat streak: 4Q
- ▸Dividend: 4.0%
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position. | News modifier +2 (SELL_IF_HOLDING → HOLD_IF_HOLDING).
Engine technical detail
verdict_path:
L4:PATH_F_SELL|L3:NEWS_MOD=+2Passed (5)
- INSIDER:OK
- 8K:CLEAN
- EARNINGS_PROXIMITY:21d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:4.3<4.5
- ASYMMETRY:-1.4=NEGATIVE
Warning (0)
none
Reward-to-Risk
-1.45
Upside
-15.8%
Downside
10.9%
Sizing output
AVOID
SetupRange Bound — RSI 58 mid-range, Bollinger mid-band
EdgeCatalyst-Driven — Earnings in 21d with 4/4 beat streak
SuitabilityModerate — Balanced profile
Investment implication
The F-path SELL output reflects an overall score of 2.8 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Growth at 6.7) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( MOMENTUM:4.3<4.5, ASYMMETRY:-1.4=NEGATIVE) reinforce the read. Current asymmetry R:R is -1.45 — supplementary context, not the trigger for this path.
The strongest dimensions are Growth at 6.7, Value at 6.5, and Catalyst at 5.9; the weakest are Insider at 3.4, Momentum at 4.3, and Risk (lower is worse) at 4.5. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of -1.45 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1High Roe No Moat
Trip ifReturn on equity falls below 25% from the current 43%.
- P2Price Above Analyst Target
Trip ifPrice falls below the $88.95 stop level, a drop of more than 7% from $95.65.
- P3Heavy Insider Selling
Trip ifInsider net selling exceeds $75M over a rolling 90 days.
- P4Moderate Valuation Dividend
Trip ifForward P/E rises above 17x from the current 13.2x.
- P5Below Average Business Quality
Trip ifOverall quality score stays below 4.0 from the current 4.7.