Consensus estimates

Analysts expect Signet Jewelers (SIG) to post net sales of $2.1 billion in the fourth quarter, which implies a YoY decline of 6.5%. Signet’s top line is expected to take a hit from a decrease in comps. A drop in traffic owing to higher competition and increased promotional spending is likely to hurt Signet’s comps.

Signet’s legacy product line is expected to decline. Meanwhile, higher-than-expected credit costs are likely to remain a drag. Soft sales and pressure on margins from higher promotional investment are anticipated to hurt the bottom line of the company.

What Analysts Expect from Signet’s Fourth Quarter

Analysts expect Signet to post adjusted earnings of $3.82 per share in the fiscal fourth quarter, which implies a YoY decline of 10.7%.

In comparison, rival Tiffany (TIF) posted mixed fourth-quarter results on March 22. The company’s top line missed analysts’ estimate and declined on a YoY basis, reflecting lower tourist spending. Meanwhile, earnings came in ahead of analysts’ estimate thanks to benefits from tax adjustments.

Rating and target price

Among the ten analysts covering Signet Jewelers stock, nine analysts suggest a “hold,” and one analyst has a “sell” recommendation. Analysts have a target price of $26.50 per share on SIG stock, which is on par with its closing price on March 22.

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