Buy hhgregg, Sell Best Buy

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My fridge finally kicked the ice bucket over the weekend. Scrambling to find a replacement before I'd have to wade through a puddle of melted ice cream to get through my kitchen, I searched for a local appliance store offering same-day delivery.

I ran across an article on hhgregg (HGG), the fast-growing consumer electronics and appliance retailer that opened nearly a dozen stores in my South Florida hub this summer. I had driven by the nearest store a few times without going in, simply noting the brazenness -- or sheer stupidity -- of opening just a few doors down from a Best Buy (BBY) in the same strip mall.

However, in the article, hhgregg's CEO pointed out pointed out that if you order an appliance in the morning, it can be delivered later that night.

Sold!

I went to hhgregg just as the store opened on Monday, had a great experience with a knowledgeable salesman, and found the perfect replacement refrigerator. Unfortunately, the next available delivery wasn't until Tuesday afternoon. I had to toss out a lot of spoiling grub. (This Chunky Monkey's gone to heaven!) However, that was the only aspect of the hhgregg purchase and eventual delivery experience that didn't go well.

Media is the Message

Just as hhgregg is blowing into new markets -- Chicago is next -- Best Buy is struggling. The once-dynamic consumer electronics leader has posted three consecutive quarters of declining profitability and comparable-store sales.

Best Buy is getting knocked around by two of the same trends currently roughing up Wal-Mart (WMT): Consumers are turning to lower-priced e-tailers, and physical media is going digital. Best Buy stocks CDs, DVDs, video games, and books, and all of these media platforms are now being delivered directly to end users over the Internet.

Step into hhgregg, and you won't find the latest Lady Gaga CD or a Blu-ray copy of "Source Code." The store emphasizes large appliances, home theater systems, and mobile gadgetry that will never be replaced digitally. Good luck downloading tonight's meatloaf or tomorrow's laundry.

Best Buy Isn't Always the Better Buy

Analysts see Best Buy growing its sales by 4% this year and a little more than 2% next year. Those same pros believe hhgregg will grow at a 14% clip this year and 15% next year.

Both stocks trade at low P/E multiples. Best Buy is fetching just seven times next year's projected profitability, with hhgregg trading at eight times next year's bottom-line estimate. Given hhgregg's growth and its more e-tail-proof product mix, I know which company to bank on with my now-refrigerated lunch money.

I'll stick with hhgregg.

Longtime Motley Fool contributor Rick Munarriz does not own shares in any of the stocks in this article. The Motley Fool owns shares of Wal-Mart Stores and Best Buy. Motley Fool newsletter services have recommended buying shares of hhgregg, Wal-Mart Stores, and Best Buy.

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