Best Buy vs FedEx Which Outperforms?

Investors looking to diversify their portfolio may consider comparing the performances of Best Buy and FedEx stocks. Best Buy, a leading retailer in consumer electronics, has shown consistent growth due to strong online sales and impressive customer service. On the other hand, FedEx, a global logistics company, has benefited from the surge in e-commerce deliveries. Understanding the financial health and market trends of these two companies can help investors make informed decisions about their investment strategies.

Best Buy or FedEx?

When comparing Best Buy and FedEx, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Best Buy and FedEx.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Best Buy has a dividend yield of 3.24%, while FedEx has a dividend yield of 1.92%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Best Buy reports a 5-year dividend growth of 15.38% year and a payout ratio of 63.39%. On the other hand, FedEx reports a 5-year dividend growth of 15.01% year and a payout ratio of 31.63%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Best Buy P/E ratio at 14.79 and FedEx's P/E ratio at 17.18. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Best Buy P/B ratio is 5.17 while FedEx's P/B ratio is 2.56.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Best Buy has seen a 5-year revenue growth of 0.47%, while FedEx's is 0.45%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Best Buy's ROE at 39.46% and FedEx's ROE at 15.00%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $86.84 for Best Buy and $278.80 for FedEx. Over the past year, Best Buy's prices ranged from $69.29 to $103.71, with a yearly change of 49.68%. FedEx's prices fluctuated between $234.45 and $313.84, with a yearly change of 33.86%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.