Analyst Mauricio Serna of UBS maintained a Buy rating on Signet Jewelers, retaining the price target of $110.00.
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Mauricio Serna has given his Buy rating due to a combination of factors that highlight Signet Jewelers’ potential for long-term growth. Over the past five years, Signet has focused on enhancing its omnichannel capabilities, refining its jewelry offerings, and optimizing its supply chain. These efforts, coupled with the company’s Grow Brand Love plan, are believed to be reigniting core comparable sales, which, along with favorable industry dynamics, are expected to drive sustainable long-term growth. Serna forecasts a 12% five-year EPS compound annual growth rate and anticipates that earnings per share beats in the near term will propel the stock towards the $110 price target.
Key insights from meetings with Signet’s management further solidify this positive outlook. The Growth Brand Love Strategy is showing progress, with eight consecutive months of positive comparable sales, indicating that the company’s initiatives are effective. Additionally, Signet is actively expanding its fashion segment, which represents a significant growth opportunity given the large addressable market in the US. Favorable pricing dynamics, particularly in diamond prices and lab-grown diamonds, also support the company’s growth prospects. Furthermore, a shift towards a brand-led operating model is expected to enhance brand control over customer experiences, positioning Signet well for future success.