NYSE:SIG

Stock Analysis Report

Executive Summary

Signet Jewelers Limited engages in the retail sale of diamond jewelry, watches, and other products.

Rewards

Trading at 27.8% below its fair value

Earnings are forecast to grow 123.11% per year

Risk Analysis

Interest payments are not well covered by earnings

Dividend of 7.05% is not well covered by earnings

Highly volatile share price over past 3 months



Snowflake Analysis

Fair value with moderate growth potential.


Similar Companies

Share Price & News

How has Signet Jewelers's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: SIG's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

46.2%

SIG

0.6%

US Specialty Retail

1.7%

US Market


1 Year Return

16.2%

SIG

21.3%

US Specialty Retail

23.6%

US Market

Return vs Industry: SIG underperformed the US Specialty Retail industry which returned 23.7% over the past year.

Return vs Market: SIG underperformed the US Market which returned 24.7% over the past year.


Shareholder returns

SIGIndustryMarket
7 Day46.2%0.6%1.7%
30 Day45.9%1.1%3.5%
90 Day82.0%7.5%11.7%
1 Year25.2%16.2%23.3%21.3%26.2%23.6%
3 Year-58.8%-63.5%46.9%39.4%53.2%43.3%
5 Year-72.9%-76.4%49.3%36.6%75.5%56.1%

Price Volatility Vs. Market

How volatile is Signet Jewelers's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Signet Jewelers undervalued compared to its fair value and its price relative to the market?

24.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: SIG ($21) is trading below our estimate of fair value ($29.08)

Significantly Below Fair Value: SIG is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: SIG is unprofitable, so we can't compare its PE Ratio to the Specialty Retail industry average.

PE vs Market: SIG is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate SIG's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: SIG is good value based on its PB Ratio (1.5x) compared to the US Specialty Retail industry average (1.5x).


Next Steps

Future Growth

How is Signet Jewelers forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

121.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SIG is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.7%).

Earnings vs Market: SIG is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: SIG's is expected to become profitable in the next 3 years.

Revenue vs Market: SIG's revenue (0.2% per year) is forecast to grow slower than the US market (7.5% per year).

High Growth Revenue: SIG's revenue (0.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if SIG's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Signet Jewelers performed over the past 5 years?

-44.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SIG is currently unprofitable.

Growing Profit Margin: SIG is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: SIG is unprofitable, and losses have increased over the past 5 years at a rate of -44.7% per year.

Accelerating Growth: Unable to compare SIG's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: SIG is unprofitable, making it difficult to compare its past year earnings growth to the Specialty Retail industry (4.5%).


Return on Equity

High ROE: SIG has a negative Return on Equity (-11.37%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Signet Jewelers's financial position?


Financial Position Analysis

Short Term Liabilities: SIG's short term assets ($2.9B) exceed its short term liabilities ($1.4B).

Long Term Liabilities: SIG's short term assets ($2.9B) do not cover its long term liabilities ($3.1B).


Debt to Equity History and Analysis

Debt Level: SIG's debt to equity ratio (47.6%) is considered high.

Reducing Debt: SIG's debt to equity ratio has reduced from 60% to 47.6% over the past 5 years.

Debt Coverage: SIG's debt is well covered by operating cash flow (62.7%).

Interest Coverage: SIG is unprofitable, therefore interest payments are not well covered by earnings.


Balance Sheet

Inventory Level: SIG has a high level of physical assets or inventory.

Debt Coverage by Assets: SIG's debt is covered by short term assets (assets are 3.7x debt).


Next Steps

Dividend

What is Signet Jewelers's current dividend yield, its reliability and sustainability?

5.01%

Current Dividend Yield


Dividend Yield vs Market

company5.0%marketbottom25%1.4%markettop25%3.7%industryaverage1.8%forecastin3Years5.3%

Current dividend yield vs market & industry

Notable Dividend: SIG's dividend (7.05%) is higher than the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: SIG's dividend (7.05%) is in the top 25% of dividend payers in the US market (3.66%)


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, SIG has been paying a dividend for less than 10 years.

Growing Dividend: SIG's dividend payments have increased, but the company has only paid a dividend for 8 years.


Current Payout to Shareholders

Dividend Coverage: SIG is paying a dividend but the company is unprofitable.


Future Payout to Shareholders

Future Dividend Coverage: SIG's dividends in 3 years are forecast to be covered by earnings (65.6% payout ratio).


Next Steps

Management

What is the CEO of Signet Jewelers's salary, the management and board of directors tenure and is there insider trading?

2.3yrs

Average management tenure


CEO

Gina Drosos (56yo)

2.4yrs

Tenure

US$8,896,303

Compensation

Ms. Virginia C. Drosos, also known as Gina, has been the Chief Executive Officer of Signet Jewelers Limited (Formerly, Signet Group PLC) since August 1, 2017. Ms. Drosos served as the President of Assurex ...


CEO Compensation Analysis

Compensation vs Market: Gina's total compensation ($USD8.90M) is above average for companies of similar size in the US market ($USD2.53M).

Compensation vs Earnings: Gina's compensation has been consistent with company performance over the past year.


Management Age and Tenure

2.3yrs

Average Tenure

55yo

Average Age

Experienced Management: SIG's management team is considered experienced (2.3 years average tenure).


Board Age and Tenure

3.1yrs

Average Tenure

59yo

Average Age

Experienced Board: SIG's board of directors are considered experienced (3.1 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$108,45909 Sep 19
Joan Hilson
EntityIndividual
Shares7,500
Max PriceUS$14.46
BuyUS$56,57406 Sep 19
Virginia Drosos
EntityIndividual
Role
Chief Executive Officer
CEO & Director
Shares4,000
Max PriceUS$14.14

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Suzanne Shane

    Senior Vice President of In-House Credit Operations & Customer Care

    • Gina Drosos (56yo)

      CEO & Director

      • Tenure: 2.4yrs
      • Compensation: US$8.90m
    • Joan Hilson

      Chief Financial Officer

      • Tenure: 0.8yrs
    • Lynn Dennison (54yo)

      Chief Legal & Transformation Officer and Corporate Secretary

      • Tenure: 5.1yrs
      • Compensation: US$1.67m
    • Liz Finn (58yo)

      Chief People Officer

      • Tenure: 1.7yrs
      • Compensation: US$1.50m
    • Oded Edelman (52yo)

      President of JamesAllen.com & Chief Digital Innovation Advisor

      • Tenure: 2.3yrs
      • Compensation: US$3.19m
    • Howard Melnick (57yo)

      Chief Information Officer

      • Tenure: 3yrs
    • Steve Lovejoy (53yo)

      Chief Supply Chain Officer

      • Tenure: 1.6yrs
    • Randi Abada

      Senior Vice President of Corporate Finance Strategy & Investor Relations

      • William Brace

        Chief Marketing Officer & Executive VP of Jared


        Board Members

        • Jon Sokoloff (62yo)

          Independent Director

          • Tenure: 3.3yrs
          • Compensation: US$245.63k
        • Sharon McCollam (56yo)

          Independent Director

          • Tenure: 1.8yrs
          • Compensation: US$295.27k
        • Howard Stitzer (67yo)

          Non-Executive Chairman

          • Tenure: 7.6yrs
          • Compensation: US$501.02k
        • R. Graf (55yo)

          Independent Director

          • Tenure: 2.5yrs
          • Compensation: US$245.63k
        • Nancy Reardon (66yo)

          Independent Director

          • Tenure: 1.8yrs
          • Compensation: US$290.16k
        • Eugenia Ulasewicz (65yo)

          Independent Non-Executive Director

          • Tenure: 6.3yrs
          • Compensation: US$265.63k
        • Helen McCluskey (64yo)

          Independent Director

          • Tenure: 6.4yrs
          • Compensation: US$265.63k
        • Gina Drosos (56yo)

          CEO & Director

          • Tenure: 2.4yrs
          • Compensation: US$8.90m
        • Zack Hicks (55yo)

          Independent Director

          • Tenure: 1.3yrs
          • Compensation: US$115.90k
        • Brian Tilzer (48yo)

          Independent Director

          • Tenure: 2.9yrs
          • Compensation: US$245.63k

        Company Information

        Signet Jewelers Limited's company bio, employee growth, exchange listings and data sources


        Key Information

        • Name: Signet Jewelers Limited
        • Ticker: SIG
        • Exchange: NYSE
        • Founded: 1950
        • Industry: Specialty Stores
        • Sector: Retail
        • Market Cap: US$1.545b
        • Shares outstanding: 52.35m
        • Website: https://www.signetjewelers.com

        Number of Employees


        Location

        • Signet Jewelers Limited
        • Clarendon House
        • 2 Church Street
        • Hamilton
        • HM11
        • Bermuda

        Listings

        TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
        0P6ALSE (London Stock Exchange)YesCommon SharesGBEURJul 1988
        SZ2DB (Deutsche Boerse AG)YesCommon SharesDEEURJul 1988
        SIGNYSE (New York Stock Exchange)YesCommon SharesUSUSDJul 1988

        Biography

        Signet Jewelers Limited engages in the retail sale of diamond jewelry, watches, and other products. As of February 02, 2019, it operated 3,334 stores and kiosks. The company operates through three segments: North America, International, and Other. The North America segment operates stores in malls and off-mall locations primarily under the Kay Jewelers, Kay Jewelers Outlet, Jared The Galleria Of Jewelry, Jared Vault, Zales Jewelers, Zales Outlet, Piercing Pagoda, Peoples Jewellers, Gordon’s Jewelers, and Mappins Jewellers regional banners; and JamesAllen.com, an online jewelry retailer Website. This segment operated 2,729 locations in the United States and 128 locations in Canada. The International segment operates stores in shopping malls and off-mall locations, principally under the H.Samuel and Ernest Jones brands. This segment operated 477 stores in the United Kingdom, the Republic of Ireland, and the Channel Islands. The Other segment is involved in the purchase and conversion of rough diamonds to polished stones, as well as provision of diamond polishing services. Signet Jewelers Limited was founded in 1950 and is based in Hamilton, Bermuda. 


        Company Analysis and Financial Data Status

        All financial data provided by Standard & Poor's Capital IQ.
        DataLast Updated (UTC time)
        Company Analysis2020/01/20 00:10
        End of Day Share Price2020/01/17 00:00
        Earnings2019/11/02
        Annual Earnings2019/02/02


        Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.