Breaking News
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Signet (SIG) Up 3.4% Since Last Earnings Report: Can It Continue?

By Zacks Investment ResearchStock MarketsApr 16, 2021 11:30PM ET
Signet (SIG) Up 3.4% Since Last Earnings Report: Can It Continue?
By Zacks Investment Research   |  Apr 16, 2021 11:30PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items

It has been about a month since the last earnings report for Signet (SIG). Shares have added about 3.4% in that time frame, underperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Signet due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

Signet’s Q4 Earnings and Sales Beat Estimates

Signet reported fourth-quarter fiscal 2021 results, wherein the top and bottom lines beat the Zacks Consensus Estimate and also improved year over year. Notably, this was the company’s third straight quarter of sales and earnings beat.

Quarter in Detail

The company reported adjusted earnings of $4.15 per share that beat the Zacks Consensus Estimate of $3.59. Moreover, the bottom line improved 13% on a year-over-year basis.

The jewelry retailer generated total sales of $2,186.5 million that surpassed the Zacks Consensus Estimate of $2,077 million. The top line also increased 1.5% year over year. Further, total same-store sales rose 7% year-on-year.

Meanwhile, e-commerce sales skyrocketed 70.5% from the prior-year quarter’s level and accounted for 23.4% of the top line. However, the company’s brick-and-mortar same-store sales were down 4.2% year-on-year.

A Sneak Peek Into Margins

We note that gross profit declined 3.2% to $869.5 million, while gross margin contracted 190 basis points (bps) to 39.8%, mainly owing to strategic promotion as well as reduced levels of service revenues primarily related to lower store traffic.

Selling, general & administrative expenses dropped 9.4% year-on-year to $573.8 million. The metric accounted for 26.2% of sales, reflecting a 320-bps improvement, driven by reduced labor, advertising and central expenses.

Further, the company reported an adjusted operating income of $293.8 million, which increased 8.7% from the prior-year quarter. Adjusted operating income margin expanded 80 bps to 13.4%.

Segment Discussion

Same-store sales in the North America segment increased 10.4% from the year-ago quarter’s levels. The segment’s e-commerce sales surged 66% year-on-year, while brick-and-mortar same-store sales inched up 0.6%.

Despite the suppressed traffic conditions in the retail environment, the company’s enhanced omni-channel capabilities aided in driving conversion levels. Notably, average transaction value ("ATV") rose 1.1% year-on-year, while the number of transactions climbed 9.9%. Further, management highlighted that same-store sales witnessed growth across all banners in the United States.

Same-store sales in the International segment declined 28.3% year over year. Meanwhile, e-commerce sales rose 115.1%, while brick-and-mortar same-store sales declined 56.2%. Further, ATV increased 6.3%, while the number of transactions fell 29.7%.

Financial Details

Signet ended the quarter with cash and cash equivalents of $1,172.5 million, accounts receivable, net of $88.7 million, and net inventories of $2,032.5 million. Long-term debt was $146.7 million and total shareholders’ equity was $1,190.3 million at the end of the quarter.

For fiscal, 2021, the company generated net cash of $1,372.3 million from operating activities. It had a free cash flow of $1,289.3 million during the aforementioned period.

For fiscal 2022, it expects capital expenditure of $150-$175 million. Markedly, the company had reduced its capital expenditure in fiscal 2021 to $83 million for conserving cash in response to the pandemic.

Store Update

As of Jan 30, 2021, the company had 2,833 stores. In fiscal 2021, it closed 428 stores, while opened 53 stores. The company plans to close more than 100 stores in fiscal 2022 alongside opening up to 100 locations.


For first-quarter fiscal 2022, management expects revenues of $1.42-$1.46 billion. Same-store sales for the quarter are expected to be 80-84%. Adjusted operating income is expected to be $40-$60 million.

Preliminary same-store sales for the first quarter till Mar 14, 2021, were nearly 16%. Given the sturdy performance so far in the fiscal first quarter, management plans to continue investing in digital and marketing capabilities. The company’s fiscal first-quarter guidance takes into consideration such a rise in investments.

Moving on, for fiscal 2022, the company expects revenues of $5.85-$6.00 billion, while same-store sales are expected to be 14-17%. Further, adjusted operating income is anticipated to be $290-$324 million.

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended upward during the past month. The consensus estimate has shifted 363.16% due to these changes.

VGM Scores

At this time, Signet has a great Growth Score of A, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.


Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Signet has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Signet Jewelers Limited (NYSE:SIG): Free Stock Analysis Report

To read this article on click here.
Signet (SIG) Up 3.4% Since Last Earnings Report: Can It Continue?

Related Articles

Tim Knight
DraftKings In A Very Dangerous Position By Tim Knight - May 07, 2021 3

This is a good real-life example of how charting can be very helpful in giving warnings that something is going wrong. Below is the chart of DraftKings Inc (NASDAQ:DKNG) without...

Signet (SIG) Up 3.4% Since Last Earnings Report: Can It Continue?

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email