Why Signet Jewelers' Q1 Rocks

Signet Jewelers Ltd. (NYSE: SIG) released its fiscal first-quarter financial results before the markets opened on Wednesday. The jeweler said that it had $0.10 in earnings per share (EPS) on $1.48 billion in revenue, compared with consensus estimates that called for a net loss of $0.09 per share on revenue of $1.4 billion. The same period of last year had EPS of $1.03 and $1.4 billion in revenue.

During the quarter, same-store sales were essentially flat versus the prior-year quarter. In North America, same store sales increased 0.6%, with average transaction value (ATV) increasing 5.0% and the number of transactions declining 2.9%. International same-store sales decreased 6.7%, with ATV increasing 2.9% and the number of transactions decreasing 8.3%.

eCommerce sales in the first quarter, including James Allen, were $146.5 million, up 80.9% on a reported basis. James Allen sales were $53.3 million in the quarter, up 29.4% compared to last year. Also eCommerce sales increased across all segments and accounted for 9.9% of first quarter sales, up from 5.8% of total sales in the prior year first quarter.

Looking ahead to fiscal full year, the company expects to see total sales in the range of $5.9 billion to $6.1 billion, with EPS of $3.75 to $4.25. The consensus estimates call for $3.96 in EPS and $6.03 billion in revenue.

Virginia Drosos, Signet Jewelers CEO, commented:

As we begin to implement our Signet Path to Brilliance transformation plan, we remain focused on driving operational improvement by executing on our Customer First, OmniChannel and Culture of Agility and Efficiency pillars. In the first quarter, we saw signs of stabilization in our overall sales and once again achieved double digit growth in eCommerce.

Shares of Signet closed Tuesday at $44.15, with a consensus analyst price target of $38.44 and a 52-week range of $33.11 and a 52-week range of $33.11 to $77.94. Following the announcement, the stock was up about 9% at $48.02 in early trading indications Wednesday.