Mark Kauzlarich/Bloomberg
is jumping nearly 10% on Monday, after the retailer raised both its fiscal-first-quarter and full-year outlook.
Signet (ticker: SIG) now expects adjusted operating income of $85 million to $100 million on revenue of $1.57 billion to $1.6 billion in the first quarter; that’s up from prior guidance that called for adjusted operating income of $40 million to $60 million on revenue of $1.42 billion to $1.46 billion. The parent of chains including Kay Jewelers and Zales forecast same-store sales to rise between 97% and 99% in the period, while Signet’s prior guidance was for 80% to 84% growth.
For the full year, Signet is now modeling for adjusted operating income of $335 million to $364 million on revenue of $6 billion to $6.14 billion. It had previously guided for adjusted operating income of $290 million to $324 million on revenue of $5.85 billion to $6 billion. It sees full-year same-store sales climbing 17% to 20%, compared with its prior outlook of 14% to 17%.
Signet stock is up 9.9% to $67.11 in recent trading. The shares have risen 146% year to date, and have surged more than 765% in the latest 12 months.
Signet attributed the strength to government stimulus, tax refunds, and “consumer enthusiasm” following vaccine rollouts. It said that average order prices also rose in the first quarter.
That said, it warned that inventory delays related to recent Covid-19 surges in India and other parts of the world could negatively impact the company’s guidance going forward. However, Signet says it “believes it has mitigated these short-term impacts.”
The company plans to close more than 100 stores throughout the fiscal year as well as open up to 100 locations.
The news comes less than a week after Signet announced it would buy jewelry-subscription-rental firm Rocksbox for an undisclosed sum.
Signet’s growth and expansion into new areas echoes some of the plans its CEO discussed with Barron’s following the company’s earnings call in March.
Write to Teresa Rivas at teresa.rivas@barrons.com
