Will Signet Rebound Following Earnings?

What's Happening With SIG View more about SIG >

Signet Jewelers (SIG) will report its fourth-quarter results before the market open on April 3. The consensus calls for earnings of $3.77 per share and revenue of $2.14 billion. During the same period last year the jeweler posted earnings of $4.28 per share and had sales of $2.29 billion. SIG stock is currently down 14.7% on the year.

Technical Analysis

SIG was recently trading at $27.09 down $43.98 from its 12-month high and $3.48 above its 12-month low. InvestorsObserver’s Stock Score Report gives SIG a 25 long-term technical score and a 55 short-term technical score. The stock has recent support above $25 and recent resistance below $29. Of the 8 analysts who cover the stock 0 rate it Strong Buy, 0 rate it Buy, 7 rate it Hold, 0 rate it Sell, and 1 rate it Strong Sell, SIG gets a score of 65 from InvestorsObserver’s Stock Score Report.

Analysts' Thoughts

SIG tumbled around 18% following the company’s last earnings report as the company swung to a loss of $1.06 per share. The stock remains in the lower end of its 52-week range, and there is a lot of negativity priced into shares at this time. The company is expected to show a profit of $3.77 for Q4, but that number is down from $4.28 during the same period last year. SIG is trading at a low 8 times future earnings, but with earnings expected to fall 45% during the current year the valuation is reasonable. Looking ahead analysts see profits inching back higher at an annual rate of 7% over the next five years. The low valuation would allow the stock to move higher on a positive quarterly report, but with so much negativity already in the stock the valuation will not prevent shares from trading even lower. Current shareholders should have an exit strategy in place just in case that does occur. Analysts have an average price target of $30.75 on the stock.

About Signet Jewelers Limited

Signet Jewelers Ltd is a retailer of diamond jewelry. Its merchandise mix includes bridal, fashion, watches and others. The bridal category includes engagement, wedding and anniversary purchases. Its segments are the Sterling Jewelers division, the Zale division, and the UK Jewelry division. The Sterling Jewelers division consists of the stores which operate in malls and off-mall locations as Kay and Jared. The division also operates mall-based regional brands and the JamesAllen.com website. The Zale division consists of the two reportable segment, Zale Jewelry, and Piercing Pagoda. The UK Jewelry division consists of the stores operating as H.Samuel and Ernest Jones. It has business operations in the US and other countries and derives key revenue from the Sterling Jewelers division.

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