Signet Jewelers stock rallied after clearing estimates for its Q1 2026 earnings early Tuesday. The parent company behind Kay, Zales and Jared lifted the lower end of its guidance, noting strong sales growth due to consumer resilience. The resilience played against other signals showing consumers moving down-market, as dollar stores and discount retailers also rallied on results.
Signet Jewelers on Tuesday reported earnings of $1.18 per share adjusted, up from $1.11 per share last year. Diluted earnings improved to 78 cents from a loss of 90 cents per share last year.
Sales increased 2% to $1.54 billion.
FactSet analysts expected $1 per share on $1.52 billion in revenue.
Same-store sales increased 2.5%.
CEO J.K. Symancyk in the release noted that Signet's three largest brands — Kay, Zales and Jared — all saw sequential comparable sales improvement from Q4 on higher margins.
CFO Joan Hilson noted that gross merchandise margins and adjusted operating margins expanded during the quarter. Meanwhile, sales improvements have outpaced inventory growth.
"We've seen a resilient consumer," Symancyk said in a Bloomberg interview, adding that it has translated to sales growth. "I think the consumer is still recognizing a good value proposition."
The company lifted the lower end of its 2026 outlook on results and maintained the high end of its forecasts.
Signet expects 2026 sales to range from $6.57 billion to $6.8 billion, up from its prior forecast for $6.53 billion at the lower end.
Same-store sales are expected to range from a 2% decline to 1.5% growth. The jeweler previously expected up to a 2.5% decline in same-store sales.
Signet guided for adjusted earnings between $7.70 and $9.38 per share. Its previous forecast expected earnings between $7.31 per share and $9.10 per share adjusted.
The midpoint of the earnings forecast was ahead of FactSet expectations for $8.31 per share. The sales forecast was below analyst estimates for $6.88 billion.
The company said that the outlook reflects current tariff levels. Less than 10% of Signet's inventory is imported from China, according to Bloomberg.
For the second quarter, Signet expects sales to range from $1.47 billion to $1.51 billion. The company forecasts same-store sales to range from a 1.5% decline to 1% growth.
FactSet analysts predict $1.488 billion in sales on 0.3% comparable sales growth.
Signet Jewelers Has Rallied Since Its March Low
SIG stock rallied 12.5% Tuesday, closing above the stock's 200-day moving average.
Signet Jewelers has soared 65% from its March low of 45.55.
Shares are down almost 6.8% this year.
The average true range is a metric available on IBD's MarketSurge that gauges the characteristic breadth of a stock's behavior. Stocks that tend to make large jumps or dives in daily action, the kind that can trigger sell rules and shake investors out of a stock, have a high ATR. Stocks that tend to make more incremental moves have lower ATRs.
With the S&P 500 and Nasdaq now in a power trend, investors can buy stocks with ATRs up to 8%, though they should be wary of being too concentrated in high-octane names.
You can follow Harrison Miller for more stock news and updates on X/Twitter @IBD_Harrison
