This Retail Stock Is Up 400% in the Last 5 Years. Is It a Buy Now?

Core Insights - Signet Jewelers is the world's largest diamond jewelry retailer, owning brands like Kay, Zales, Jared, and Blue Nile, and has seen its stock rise over 400% in the last five years despite market volatility [2][5] - The company's recent earnings report led to an 11% stock increase, reflecting positive investor sentiment [1][4] - Signet's growth strategy includes expanding the accessible luxury category, enhancing digital commerce, and focusing on high-margin services [3][6] Financial Performance - In the second quarter of fiscal 2025, Signet reported a decline in revenue and profits due to weak consumer spending, but comparable sales have turned positive in the third quarter [5] - The fashion segment has outperformed expectations, with same-store sales positive in July, August, and September, and revenue from new merchandise increasing by 50% [5] - Lab-created diamonds have contributed to a 1.6% increase in average transaction value and a 25% rise in fashion sales during the quarter [5] Strategic Initiatives - Signet is targeting $200 million in cost savings this year by rationalizing its store base and investing in higher-margin businesses [6] - The company has been actively repurchasing shares, reducing outstanding shares by 1% in the second quarter and 7.6% earlier in the year [6] - Despite recent stock gains, Signet's forward P/E ratio remains low at 8, indicating potential for future growth [6]