Best Buy (BBY) fiscal Q1 results were mostly in-line with estimates and the impact of tariffs was not as negative as previously expected, Truist said Thursday in an earnings recap.
The company's adjusted earnings of $1.15 per diluted share was above the Street consensus of $1.09. Its revenue at $8.77 billion trailed estimates of $8.81 billion.
With the core trends remaining muted, the company's positive same-store sales in computing and tablets categories were mitigated by weaker output of the bigger ticket or more discretionary categories, the firm said.
However, Best Buy's efforts to manage tariffs, including sourcing diversification and vendor negotiations, are paying off better than previously anticipated by the brokerage and the company itself, Truist said. The brokerage raised its EPS estimates for 2025 and 2026 to $6.15 and $6.65 from $5.35 and $4.85, citing reduced tariff impact.
The company now expects its cost of goods sold exposure from China at about 30% to 35% compared with 55% just three months ago, the brokerage noted.
Truist maintained a neutral rating on the stock and raised the price target to $69 from $64.
Price: 65.32, Change: -6.20, Percent Change: -8.67
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