Signet Jewelers Balances Resilient Demand With Cautious Holiday Outlook

Core Viewpoint - Signet Jewelers Ltd. reported a stronger third quarter but has a cautious outlook for the holiday season due to pressures on value-conscious shoppers [1][2]. Group 1: Financial Performance - The company reported third-quarter adjusted earnings per share of 63 cents, exceeding analysts' expectations of 29 cents [2]. - Signet achieved higher earnings and wider margins, supported by firm pricing, improved assortments, and tighter cost controls [3]. - The firm anticipates fourth-quarter sales between $2.24 billion and $2.37 billion [3]. Group 2: Analyst Insights - Telsey Advisory Group analyst Dana Telsey maintained a Market Perform rating on the stock and raised the price target from $92 to $96 [4]. - Telsey noted a decline in consumer confidence and a slowdown in traffic from late October through November, particularly affecting lower- to middle-income shoppers [4][5]. - The fourth-quarter comparable sales outlook ranges from a 5% decline to a 0.5% increase, with bridal and fashion units expected to fall by mid-single digits at the low end [5]. Group 3: Marketing and Future Projections - Telsey raised her EPS estimate for fiscal 2026 to $9.33 from $8.91 and for fiscal 2027 to $10.24 from $9.69 following the third-quarter performance [7]. - The company is shifting more of its marketing budget towards streaming platforms, recognizing that over 70% of adults now use streaming as their primary video source [7].