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Signet (SIG) to Post Q2 Earnings: What Awaits the Stock?

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Signet Jewelers Limited SIG is likely to register top- and bottom-line growth when it reports second-quarter fiscal 2022 results on Sep 2, before the opening bell. The Zacks Consensus Estimate for revenues is pegged at $1,262 million, which indicates a surge of 42% from the prior-year quarter’s reported figure.

The Zacks Consensus Estimate for quarterly earnings has moved up 4 cents in the past seven days to $1.61 per share. In the prior-year quarter, the company had reported a loss of $1.13 per share. In the last reported quarter, the company’s bottom line outperformed the Zacks Consensus Estimate by 58.2%. This renowned jewelry and accessories retailer has a trailing four-quarter earnings surprise of 58.3%, on average.

Key aspects to Note

Signet’s second-quarter top line is likely to have gained from growth in e-commerce sales. The company’s online growth has been backed by efficient measures to boost omni-channel capabilities, as part of the ‘Signet Path to Brilliance’ plan. The company has been introducing technology tools like conversational messaging, improved tech search, virtual try-on, along with several new search browse and checkout features on its website. It is consistently integrating its physical stores and digital experiences through data-driven in-store consultations as well as buy online pickup in-store and curbside option.

The company is likely to have gained from strong product offerings across categories, regions and channels. Its big brand banners such as Kay, Zales, Jared and Piercing Pagoda have been doing well. Its efforts to boost assortments in Accessible Luxury and Value categories are encouraging. It also focuses on boosting customers’ shopping experience as well as tailored merchandise assortments and services.

On its last earnings call, management guided second-quarter revenues in the bracket of $1.60-$1.65 billion, with same-store sales between 76% and 82%.

However, we cannot ignore the concerns surrounding store closures, especially across certain international markets. Increased operating costs amid the pandemic and high marketing expenses are other concerns.

Signet Jewelers Limited Price, Consensus and EPS Surprise

Signet Jewelers Limited Price, Consensus and EPS Surprise
Signet Jewelers Limited Price, Consensus and EPS Surprise

Signet Jewelers Limited price-consensus-eps-surprise-chart | Signet Jewelers Limited Quote

What the Zacks Model Unveils

Our proven model predicts an earnings beat for Signet this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Signet has a Zacks Rank #2 and an Earnings ESP of +2.28%.

Other Stocks With Favorable Combination

Here are some other companies you may want to consider as our model shows that these also have the right combination of elements to post an earnings beat:

lululemon athletica inc. LULU currently has an Earnings ESP of +3.06% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

American Eagle Outfitters, Inc. AEO currently has an Earnings ESP of +0.66% and a Zacks Rank #3.

Costco Wholesale Corporation COST currently has an Earnings ESP of +0.44% and carries a Zacks Rank #3.

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

American Eagle Outfitters, Inc. (AEO) : Free Stock Analysis Report

Costco Wholesale Corporation (COST) : Free Stock Analysis Report

Signet Jewelers Limited (SIG) : Free Stock Analysis Report

lululemon athletica inc. (LULU) : Free Stock Analysis Report

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