Should You Buy Best Buy Stock in 2026?

When Best Buy (NYSE: BBY) reported full-year fiscal 2026 earnings, the numbers looked... OK. That's actually not a bad outcome, given that the retailer beat Wall Street earnings expectations. Still, the future is very uncertain, and investors need to tread with caution. Here's what you need to know.

Best Buy looks reasonably priced

Best Buy's price-to-sales ratio is 0.4x, which is a touch below its five-year average. The company's price-to-earnings ratio is 13.5x compared to a five-year average of 14.6x. The price-to-book ratio is roughly in line with its five-year average. And the price-to-forward earnings ratio is 12.6x versus a longer-term average of 13.1x.

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Valuation is more art than science, but taken together, these traditional valuation metrics suggest Best Buy is reasonably priced to maybe a little cheap. And the beat of analyst earning expectations to close out fiscal 2026 was a clear positive. However, before you buy this retailer, you also need to consider some of the negatives.

Better days may not be right ahead for Best Buy

While Best Buy beat on the bottom line, it fell short of Wall Street's revenue expectations. And, notably, same-store sales fell 0.8% in the final quarter of fiscal 2026. That includes the all-important holiday season, which is not a good sign. For the full fiscal year, meanwhile, same-store sales only rose 0.5%. At best, it looks like Best Buy is sort of treading water as a business.

That's not shocking, however, given that consumers are tightening their budgets. Low-price retailers focused on necessity items are thriving, but more discretionary retailers, like technology-focused Best Buy, are having a relatively hard time right now. However, the real problem with buying Best Buy is that the company doesn't have a particularly positive outlook, projecting that same-store sales will fall between a decline of 1% and a rise of 1% in the upcoming fiscal year. The midpoint of that range is flat, which is hardly a compelling story.

There is no catalyst for Best Buy

When you add it all up, Best Buy is muddling through a rough patch and doesn't seem to think the near-term future will be any better than the recent past. The stock looks reasonably priced, but without a reason to believe the retailer's performance will improve, there's also no reason to believe the stock price will move appreciably higher. Most investors should probably keep Best Buy on their watch lists for now.

Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Best Buy. The Motley Fool has a disclosure policy.