In August of this year, Best Buy Co Inc (NYSE:BBY) CEO Hubert Joly warned owners of BBY stock that Q2’s same-store sales growth of 5.5% wasn’t the “new normal.” And strictly speaking, he was right. For the third quarter of the year, same-store sales were only up 4.4%.

In retrospect we can see that Joly was mostly trying to stave off excessive exuberance that would lead to impossibly high expectations for the future, and he was successful in that regard BBY stock fell nearly 12% the day the numbers were posted.

Investors weren’t fooled for long though; shares have fought their way to a gain in the meantime. The $64,000 question is, with two solid quarters to its credit and earnings now in their fourth year of measurable, meaningful growth, can we now finally declare the turnaround effort has worked? In a word, yes.

The Turnaround Has Taken Hold

It’s not something many investors anticipated being said back in 2012, when Joly was named as chief on hopes that he’d be able to turn the ship around.

The electronics retailer was essentially in shambles thanks to Amazon.com, Inc. (NASDAQ:AMZN) and the relationship was tense between the Board of Directors, then-CEO Brian Dunn and founder Richard Schulze. That baggage had the potential to be the undoing of the company.

Even after the dust settled following Joly’s first few weeks on the job, the pros had their doubts. In November of 2012, just prior to a key meeting with Wall Street’s key analysts, Wedbush analyst Michael Pachter commented “I just think people are going to be truly unimpressed with anything they [the company’s management team] have to say.”

Best Buy stock is up more than 300% since then. Annual operating income has improved from nil to a pace of $1.85 billion. Sales are much stronger too.

The turnaround caught plenty of people off guard, who had largely deemed Joly’s experience with his previous employer, hospitality and travel company Carlson an irrelevant background.

While it’s a consumer-facing business that requires a penchant for customer service, many assumed competing against an ecommerce giant was a bit of his wheelhouse. Big mistake.

Even if his time at Carlson wasn’t informative though, Joly’s experience prior to his time with Carlson was. He was President of EDS France, served as CEO of Vivendi Universal Games, and spent 14 years working within the technology arm of management consulting outfit McKinsey & Company.

In many of his roles, Joly was explicitly charged with turning a business around.

While all companies are different, he says most turnarounds are quite similar, requiring the same basic core elements. These include, among others, getting a company moving (in any direction), encouraging quick decision-making and insisting on action-taking sooner than later.

In other words, his turnaround strategies ultimately focus on getting the most out of people. They’re the one common element within all companies, and also the most important element.

His turnaround strategies are also working, changing Best Buy’s corporate culture even more than upgrading its operational efficiencies and improving its marketing firepower.

Looking Ahead for BBY Stock

The 40% gain BBY stock has logged this year alone is certainly daunting; how much more can a retailer fighting Amazon really expect to grow?

Thing is, with a trailing P/E of 15.9 and a forward-looking P/E of 14.1, there’s no real valuation headwind to hold BBY stock back. And, there’s the not-so-small reality that analysts have been woefully underestimating this company for years now.

It’s topped earnings estimates in 14 of its past 15 reported quarters, and continues to downplay its potential. Analysts tend to take the company at its word, not realizing the string of earnings beats it’s left behind. The pattern isn’t likely to stop now.

That said, the current quarter could be a make-or-break one for Best Buy. Though results have been firm in the prior two reported quarters, the retailer makes about half of its annual net income in the fourth quarter alone. It needs a big Q4 to put an exclamation point on the rebuilding effort thus far.

If Best Buy can dish out one more pleasant surprise, it’ll be pretty much impossible to say Joly’s turnaround work hasn’t taken hold.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can follow him on Twitter, at @jbrumley.