Best Buy shares sink after sales miss expectations

Best Buy Co. Inc. shares sank 8.6% in Wednesday premarket trading after the consumer electronics retailer reported fourth-quarter sales that missed expectations. Net income was $607.0 million, or $1.91 per share, up from $479.0 million, or $1.40 per share, for the same period last year. Adjusted EPS was $1.95, beating the $1.67 FactSet consensus. Sales totaled $13.48 billion, down from $13.62 billion last year, and below the $13.62 billion FactSet consensus. Domestic same-store sales fell 0.9%, compared with the FactSet consensus of a 0.4% increase. Best Buy Chief Executive Hubert Joly said "product availability constraints" and "weaker-than-expected demand" in gaming were largely responsible for the sales shortfall. Best Buy sees first-quarter revenue in the range of $8.2 billion and $8.3 billion, and domestic same-store sales in the range of a 1% decline and a 2% decline. The FactSet consensus is for sales of $8.47 billion, and a same-store sales increase of 0.6% Best Buy stock is up 33.6% for the past year, while the S&P 500 index is up 19.5% for the period.

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