Signet Shines After Upbeat Guidance

Signet Jewelers shined a bit brighter after reporting fourth-quarter earnings. 💎

The company reported adjusted earnings per share of $5.52, slightly above the $5.43 expected. Sales of $2.666 billion also topped the $2.652 billion consensus estimate.

North American same-store sales declined 9.3% YoY, but average transaction value rose 3.9% to help offset lower transaction volumes. Meanwhile, international same-store sales fell 6.8% YoY, with average transaction value rising 13.3%. 🔻

For the coming year, U.S. Jewelry industry revenues are expected to decline by mid-single digits, with lower price point consumers remaining under pressure. Like other retailers, the company is also feeling the impact of a weaker economy, high inflation, and changing consumer behavior. 

As for the engagements segment of the market, which drives nearly 50% of Signet’s merchandise sales, the company expects headwinds to continue into the second half of fiscal 2024. It’s looking for a turnaround in late fiscal 2024 and continued recovery into fiscal 2025. 💍

Despite all that, Signet’s executives are optimistic as they head into fiscal 2024. They say the company is well-positioned to capture market share after mitigating its supply chain issues. And ultimately, they’re confident in their ability to deliver an annual double-digit non-GAAP operating margin despite the industry headwinds. 🔮

Overall, investors took the news positively. $SIG shares were up over 11% on the day. 📈

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