Best Buy Co., Inc. (NYSE:BBY) – Earnings Surprise

BBY - Chart" src="http://stock-tipper.com/wp-content/uploads/2011/06/BBY01.png" alt="" width="479" height="277" />

BBY - Google Finance" href="http://www.google.com/finance?q=NYSE%3ABBY">Best Buy Co., Inc. BBY reported results for their first quarter this morning and the stock price jumped sharply as expectations were exceeded. The company reported revenue of $10.9 billion, which was up 1% from the same quarter last year.

A 12% increase in online revenue seems to have been the main reason for the positive reaction from the market – as it demonstrated that efforts to take on other online retailers were beginning to bear fruit. Net income dropped 12% to $136 million, but the market was expecting a much worse result.

The stock opened at a strong premium at $31.11 and quickly jumped to a high of $31.32. Profit takers drove the stock down to a low of $29.35 during the first hour of the trading session. However, bargain hunters did emerge and the stock closed well off the day's low, finishing at $30.13.

Call option trading activity increased sharply on the day prior to the release of the report. That suggests that some did have an advanced warning on the results. From a charting perspective, the strong bounce from recent lows at $28.50 suggests that a floor has been found. The long lower wick from today's candle also supports that premise.

A link to the full press release is here.

Stock-tipper.com is not a financial advisor and does not give investment advice or stock recommendations. The information provided on this website is for entertainment purposes only. Investors should seek professional investment advice.