Is Best Buy Co., Inc. overvalued or undervalued?

As of 28 November 2025, the valuation grade for Best Buy Co., Inc. has moved from very expensive to expensive, indicating a shift towards a less favorable assessment. The company appears to be overvalued based on its current metrics, with a P/E ratio of 13, a Price to Book Value of 5.59, and an EV to EBITDA of 6.20. In comparison, its peer, which has a P/E of 13.545 and an EV to EBITDA of 6.2951, suggests that Best Buy is trading at a slight discount relative to its closest competitor.
Despite the high ROCE of 51.18% and ROE of 44.15%, which reflect strong profitability, the overall valuation ratios indicate that the stock is priced too high given its performance. Additionally, Best Buy has underperformed the S&P 500 significantly over multiple periods, with a YTD return of -7.60% compared to the S&P 500's 16.45%, reinforcing the notion that the stock may not be a favorable investment at its current price.