BBY (Best Buy Co Inc) vs S&P 500 Comparison

BBY

S&P 500

Compare the stock's returns with its benchmark index and competitors. Gain insights into its relative performance over time.

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BBY

S&P 500

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BBY

S&P 500

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Compare the stock's returns with its benchmark index and competitors. Gain insights into its relative performance over time.

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S&P 500

BBY

GME

9435

JBH

MWG

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Compare the stock's returns with its benchmark index and competitors. Gain insights into its relative performance over time.

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Best Buy Co Inc
Glance View

Economic Moat

None

Market Cap

18B USD

Industry

Retail

Best Buy Co Inc., the electronics retail giant, has carved its niche in the consumer electronics industry by providing a comprehensive selection of products, ranging from cutting-edge gadgets to household appliances. Founded in 1966, the company has matured from a small audio specialty store into a powerhouse of technology retail. It operates both through its extensive network of physical stores across North America and a thriving online platform, reflecting its successful adaptation to the changing retail landscape. With a customer-centric focus, Best Buy enhances its offerings through services like the Geek Squad, providing customer support and product repair, thus creating a value-added shopping experience that goes beyond mere product sales. At the core of Best Buy’s profitability lies its strategic ability to leverage its extensive supply chain relationships and its adept inventory management, which enable it to keep pace with rapid technological advancements. It generates revenue by not only selling products directly but also by offering installation, maintenance, and protection plans, which account for a significant portion of its income. Additionally, Best Buy excels in creating partnerships with major brands, allowing exclusive product launches and in-store experiences that draw customers in. The company’s success hinges on balancing competitive pricing with a strong emphasis on customer service, in-store experience, and strategic use of data analytics to inform product selections and marketing strategies.

View BBY Analysis

BBY Intrinsic Value

What is Intrinsic Value?

Economic Moat is a concept popularized by Warren Buffett to describe a company's durable competitive advantage. It represents the 'moat' that protects a company from competitors and helps it sustain profitability over the long term. Our analysis of the past 10 years showed that companies with a wide economic moat significantly outperformed the market, delivering +645% returns compared to +189% for the S&P 500.

Our research into Economic Moat performance spans the past 10 years and focuses on companies with a wide economic moat. For this analysis, we calculated the average stock price returns of these companies, comparing them to the performance of the S&P 500 index over the same period.

The results were compelling: wide moat stocks achieved a remarkable +645% average return, compared to +188% for the broader market. This difference highlights the long-term benefits of investing in businesses that can maintain their market position and pricing power over time.

Note: This research does not account for survivorship bias. Past performance is not indicative of future results.

Determining whether a company has an economic moat requires both a deep dive into financial metrics and a qualitative assessment of its competitive position. Our analysts conduct a rigorous evaluation that focuses on identifying structural advantages that enable a company to sustain profitability and defend its market share over the long term.

The process begins with an analysis of a company’s historical financial performance. We assess how consistently the company has generated returns above its cost of capital and whether those returns have been stable or improving. However, financial performance alone doesn’t reveal the full picture. To understand the sources of these advantages, we evaluate five key drivers of economic moats:

Network Effect: We analyze whether the value of a company’s product or service grows as its user base expands. Platforms like payment systems or marketplaces benefit from this self-reinforcing.

Switching Costs: We assess whether customers face significant costs or disruptions when switching to a competitor’s product or service. High switching costs create customer stickiness and provide pricing power.

Intangible Assets: Strong brands, patents, and regulatory licenses can protect a company’s market position by creating barriers for competitors or enabling premium pricing. For example, a well-recognized consumer brand may command higher customer loyalty and margins.

Efficient scale: Occurs when a market is optimally served by one or a few players, making it unprofitable for new entrants to compete. This typically happens in industries with high fixed costs or geographic constraints, such as utilities or pipelines.

Cost Advantage: Companies with structural cost advantages can produce goods or services at a lower cost than their competitors, enabling them to offer competitive pricing or maintain higher margins. These advantages often arise from economies of scale, superior supply chain management, or proprietary technology. Firms like Walmart leverage their massive scale to negotiate better terms with suppliers, allowing them to undercut competitors on price.

By examining these factors in combination with a company’s financial performance and market positioning, we classify each company into one of three categories:

This rigorous evaluation ensures that our moat ratings are both comprehensive and reliable, giving investors the tools they need to make well-informed, long-term decisions.

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AU		JB Hi-Fi Ltd ASX:JBH	Select
VN	M	Mobile World Investment Corp VN:MWG	Select
CN		Suning.Com Co Ltd SZSE:002024	Select
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JP		Hikari Tsushin Inc TSE:9435	Add
AU		JB Hi-Fi Ltd ASX:JBH	Add
VN	M	Mobile World Investment Corp VN:MWG	Add
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BBY

vs

S&P 500

Stocks Performance
BBY vs S&P 500

Performance Gap
BBY vs S&P 500

Performance By Year
BBY vs S&P 500

Competitors Performance
Best Buy Co Inc vs Peers

Best Buy Co Inc
Glance View

Company

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BBY vs S&P 500

Stocks Performance BBY vs S&P 500

Performance Gap BBY vs S&P 500

Performance By Year BBY vs S&P 500

Competitors Performance Best Buy Co Inc vs Peers

Best Buy Co Inc Glance View

Company

Help

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Stocks

BBY

vs

S&P 500

Stocks Performance
BBY vs S&P 500

Performance Gap
BBY vs S&P 500

Performance By Year
BBY vs S&P 500

Competitors Performance
Best Buy Co Inc vs Peers

Best Buy Co Inc
Glance View