Options Corner: Disappointing Signet Jewelers Offers A Diamond In The Rough
While the holiday season tends to brighten spirits, love was certainly not in the air for Signet Jewelers Ltd (NYSE:SIG). Early last month, the diamond jewelry retailer posted disappointing results for its fiscal third quarter. Nevertheless, investors historically have bought extreme dips in SIG stock, opening the real possibility of a near-term bullish options strategy.
On paper, Signet posted adjusted earnings per share of 24 cents, missing Wall Street’s consensus view of 33 cents. On the top line, the company rang up sales of $1.35 billion, which unfortunately represented a 3.1% year-over-year decline. As well, this figure missed analysts’ revenue target of $1.37 billion.
During the conference call, Signet CFO Joan Hilson remarked that the competitive environment dragged down the Q3 print. What also sent investors rushing for the exits was management guiding current-quarter sales to a range between $2.38 billion and $2.46 billion. Previously, the consensus stood at $2.45 billion.
Still, the market tends to move on anticipated events. Given that the poor print is now in the rearview mirror, traders may consider looking at SIG stock from a fresh perspective.
Fundamental and Technical Underpinnings Point Northward for SIG Stock
To be sure, the dynamic political and economic ecosystem presents significant concerns for investors. Nevertheless, key datapoints suggest that consumer sentiment is generally improving, which may have positive implications for Signet’s core business. After …
Full story available on Benzinga.com
