Using the PEG framework with analyst consensus forward EPS growth of 19.5% plus 6.1% dividend yield, Best Buy Co., Inc. has a fair value of $126.59 based on NTM EPS (FY2027) of $6.51. The current PEG ratio is 0.50.
PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.
PEG works well for steady growers with predictable earnings.
| EPS Growth RateForward | 13.4% |
| Dividend Yield | +6.1% |
| Adjusted Growth (clamped 8–25%) | 19.5% |
| Fair P/E | 19.5x |
| NTM EPS (FY2027) | $6.51 |
| Fair Value | $126.59 |
| Period | EPS Est. | Growth | Analysts |
|---|---|---|---|
| FY2026 (actual) | $5.04 | — | — |
| FY2027E | $6.51 | +29.1% | 16 |
| FY2028E | $7.05 | +8.3% | 17 |
| FY2029E | $7.71 | +9.4% | 9 |
| FY2030E | $8.69 | +12.7% | 4 |
| FY2031E | $9.45 | +8.7% | 3 |
5Y Forward EPS CAGR: 13.4%
| Year | Net Income | EPS | YoY |
|---|---|---|---|
| FY2022 | $2.5B | $9.84 | — |
| FY2023 | $1.4B | $6.29 | -36.1% |
| FY2024 | $1.2B | $5.68 | -9.7% |
| FY2025 | $927.0M | $4.28 | -24.6% |
| FY2026 | $1.1B | $5.04 | +17.8% |
4Y Historical EPS CAGR: -15.4%
The PEG Fair Value uses the Price/Earnings-to-Growth framework. A stock is fairly valued when its P/E ratio equals its earnings growth rate (PEG = 1.0). This model adds dividend yield to the growth rate per the original PEGY formula.
Growth rate priority: analyst consensus forward EPS CAGR (when ≥ 3 analysts cover the stock), falling back to historical EPS CAGR. Using EPS rather than net income avoids distortion from share buybacks. The growth rate is clamped between 8% and 25% — below 8% would undervalue stable earners, while above 25% would overvalue unsustainable spikes.