Best Buy (NYSE:BBY) reported earnings earlier this week and they were very impressive. While one of the last big box electronics retailers has been making a comeback from near oblivion for years now, most analysts expected the slow holiday season to put a dent in its long-term recovery.

It didn’t.

Also, BBY stock’s Q4 didn’t end until Feb. 2, which means it also included January, which was jammed up from the government shutdown, with nearly a million government workers and contractors out of the spending cycle for the most part.

That’s why when BBY reported a near doubling of net income compared to the same quarter last year and same store sales beat expectations by 50%, it was pretty surprising.

While BBY stock is off nearly 7% in the past 12 months, it’s up nearly 30% in the past three months.

Changes for BBY Stock
CEO Hubert Joly took over in 2012 to reorganize BBY to fight the growing competition coming from e-commerce companies like Amazon (NASDAQ:AMZN) and eBay (NASDAQ:EBAY). Some of the other national electronics chains couldn’t evolve fast enough and closed their doors.

Department stores were also struggling with the new challenges, and many companies started to upgrade their e-commerce, lower their brick-and-mortar footprints and focus on core sectors that had solid margins and healthy growth.

Joly took some of that digital transition to heart, but also understood that the value of a store is the people that work in the store and interact with the customers. He beefed up the brick and mortar experience. And that has been paying off quarter after quarter.

If you go into a Best Buy today, sales reps are knowledgeable and are quick to help and offer advice. They can also ring you up in their section rather than you having to take your products to the main register. These are the kind of tiny changes that cumulatively make a huge difference to the experience.

BBY is also seeing its services — in-home installation and tech service — grow quickly. And its online purchase-in store pick-up is also a very popular service that is helping the company grow.

Another surprise with this earnings report is the fact that there are tariffs on many of the goods that are sold at BBY since most are manufactured in China. The fact that the company was able to digest these tariffs and still post the numbers it did is impressive.

What’s more, the company has guided for solid 10% growth for the rest of the fiscal year, which means it sees plenty of growth still left in the sector.

Being one of the sole survivors in this niche means BBY stock has outlasted many competitors and can build its own lane as it competes with the like of Amazon, instead of playing Amazon’s game.

It’s easy to forget that even with this all this potential growth still lying ahead, Best Buy offers a solid 2.9% dividend on top of its potential gains. The dividend makes BBY stock a good choice for investors looking for a long-term total return stock in one of the market’s most enduring growth sectors.

— Louis Navellier

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Source: Investor Place