The silver lining in Best Buy's (BBY -7.1%) painful Q2 miss is that gross margin - an ongoing...


The silver lining in Best Buy's (BBY -7.1%) painful Q2 miss is that gross margin - an ongoing sore spot - rose 0.6 points to 25.9%. But with 15% inventory growth, against sales growth of just 6.9%, JPMorgan wonders whether Best Buy passed up sales in order to preserve margin: "Going back to the issue that surrounds this stock - can BBY grow sales and margins simultaneously?"

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  • billddrummer
    , contributor
    Comments (1761) | Send Message
     
    BBY apparently opened too many stores in the quarter and overstocked the existing stores.

     

    The company will need to get its inventory management under control--otherwise, look for more earnings misses in the next couple of quarters.
    15 Jun 2010, 11:07 PM Reply Like
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