Yahoo Finance Signet (SIG) Rides High on Growth Strategies: Apt to Hold
Signet Jewelers Limited SIG appears impressive, thanks to solid growth in its e-commerce business and smooth progress in its Inspiring Brilliance strategy. Sturdy gains from growth initiatives like unique banner value propositions, marketing efforts and advanced connected-commerce capabilities have also been aiding its performance. SIG’s innovation efforts bode well. Buoyed by the aforesaid endeavors, shares of this jewelry retailer have gained 9.8% in the past six months against the industry’s 11.9% decline.
Let’s Delve Deeper
Signet has been making moves to enrich customers’ experience. The company has been integrating its physical stores with advanced virtual experiences through data-driven in-store consultations and services like buy online pickup in store and curbside options. Notably, the company has been witnessing improvements at nearly all of the digital touchpoints. Loyalty and digital enrolment increased 2.9 times in the fourth quarter of fiscal 2023 versus the third quarter. Two-way SMS represented 20% of digital sales.
Additionally, the company has launched Vault Rewards in Jared, KAY and Zales, and has about two million members. Management anticipates reaching roughly four million vault rewards members by the fiscal 2024 end.
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The company’s connected-commerce strategy helps in combining customer experiences, leveraging in-store and online as well as mobile and ubiquitous delivery. Such efforts indicate that Signet has been focusing on evolving its channel-agnostic retailer capabilities. This is helping the company cater to customers’ needs more aptly.
Digital business is the key growth driver. The company remains focused on enhancing the data- analytics capabilities with higher precision. It is leveraging the analytics capability to optimize the way of adding product assortments. Markedly, the company had added several features and capabilities across its digital platform to offer a seamless customer experience. It has rolled out Google Business Messages and Apple Business Chat features, which allow customers to engage with virtual jewelry consultants in real time or offline from search results or maps. The company has been offering curbside pickup, virtual consultations and buy online pick- up in store in various locations.
We note that Signet’s Inspiring Brilliance strategy appears encouraging. This strategy focuses on expanding big banners, boosting services, broadening the Accessible Luxury and Value segments, as well as accelerating digital commerce, among others. As part of the Inspiring Brilliance growth strategy, the company makes use of data-driven insights for targeting new and existing customers.
Signet’s acquisition of Diamonds Direct USA Inc appears promising too. Diamonds Direct is known for its unique bridal-focused collections and shopping experience. This has now become the company’s highly-personalized bridal destination, offering customers valuable bridal experiences.
Further, the company’s acquisition of Blue Nile is also a tailwind. Blue Nile is the pioneer in online diamond marketplace shopping, thus enhancing the company’s portfolio and its customer base.
Bottom Line
Signet will continue to perform well on the bourses given the above-discussed factors.
The Zacks Consensus Estimate for fiscal 2025 sales and earnings per share (EPS) is currently pegged at $7.93 billion and $12.03, respectively. These estimates show corresponding increases of 2.5% and 7.6% year over year. This current Zacks Rank #3 (Hold) stock has an expected earnings growth rate of 8% and a VGM Score of A.
Solid Picks in Retail
We have highlighted three top-ranked stocks, namely Abercrombie & Fitch ANF, Urban Outfitters URBN and Hibbett Sports HIBB.
Abercrombie & Fitch, a leading casual apparel retailer, currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Abercrombie & Fitch’s current financial-year sales and EPS suggests growth of 2.1% and 472%, respectively, from the year-ago reported figures. ANF delivered a negative trailing four-quarter earnings surprise of 141.2%.
Urban Outfitters, a retailer of fashion apparel, accessories and footwear, currently carries a Zacks Rank #2 (Buy). URBN delivered break-even earnings in the last reported quarter.
The Zacks Consensus Estimate for Urban Outfitters’ current financial-year sales and EPS suggests growth of 4% and 40.6%, respectively, from the year-ago reported figures.
Hibbett, a sporting goods retailer, currently carries a Zacks Rank of 2. The company has a negative trailing four-quarter earnings surprise of 13.9%, on average.
The Zacks Consensus Estimate for Hibbett’s current financial-year sales suggests growth of 5.7% from the year-ago reported figure.
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Abercrombie & Fitch Company (ANF) : Free Stock Analysis Report
Urban Outfitters, Inc. (URBN) : Free Stock Analysis Report
Hibbett, Inc. (HIBB) : Free Stock Analysis Report
Signet Jewelers Limited (SIG) : Free Stock Analysis Report
