Conn's and Best Buy: Two retail turnarounds using different approaches


Conn's (CONN +12%) lifts its forecast for full-year EPS to $2.75-$2.80 from $2.50-$2.56. Same-store sales at Conn's are expected to rise 22% to 25% for the fiscal year ending January 31, 2014.

Best Buy (BBY -0.1%), on the other hand, has cut costs and focused its message to consumers on service and expertise. The company has stuck with electronics and mobile, but refined its selling channels.

Sector watch: Though Best Buy has done a fine job with its turnaround in 2013, the soaring margins and momentum at Conn's from furniture and mattress sales are hard to ignore. The retail chain also derives a good chunk of its business by offering customers favorable credit terms, a temptation that Best Buy has resisted in the past due to the risk it brings into the equation.

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