Signet Jewelers Limited
Signet Jewelers Limited Fundamental Analysis
Signet Jewelers Limited (SIG) shows weak financial fundamentals with a PE ratio of 28.19, profit margin of 2.13%, and ROE of 8.20%. The company generates $6.8B in annual revenue with weak year-over-year growth of -8.56%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 32.0/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze SIG's fundamental strength across five key dimensions:
Efficiency Score
WeakSIG struggles to generate sufficient returns from assets.
Valuation Score
WeakSIG trades at a premium to fair value.
Growth Score
WeakSIG faces weak or negative growth trends.
Financial Health Score
ModerateSIG shows balanced financial health with some risks.
Profitability Score
WeakSIG struggles to sustain strong margins.
Key Financial Metrics
Is SIG Expensive or Cheap?
P/E Ratio
SIG trades at 28.19 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, SIG's PEG of 2.26 indicates potential overvaluation.
Price to Book
The market values Signet Jewelers Limited at 2.37 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 3.79 times EBITDA. This is generally considered low.
How Well Does SIG Make Money?
Net Profit Margin
For every $100 in sales, Signet Jewelers Limited keeps $2.13 as profit after all expenses.
Operating Margin
Core operations generate 3.47 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $8.20 in profit for every $100 of shareholder equity.
ROA
Signet Jewelers Limited generates $2.68 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Signet Jewelers Limited produces operating cash flow of $725.34M, showing steady but balanced cash generation.
Free Cash Flow
Signet Jewelers Limited produces free cash flow of $593.16M, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $14.49 in free cash annually.
FCF Yield
SIG converts 14.37% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
28.19
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
2.26
vs 25 benchmark
P/B Ratio
Price to book value ratio
2.37
vs 25 benchmark
P/S Ratio
Price to sales ratio
0.60
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
1.17
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.50
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.08
vs 25 benchmark
ROA
Return on assets percentage
0.03
vs 25 benchmark
ROCE
Return on capital employed
0.06
vs 25 benchmark
How SIG Stacks Against Its Sector Peers
| Metric | SIG Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 28.19 | 25.08 | Worse (Expensive) |
| ROE | 8.20% | 1151.00% | Weak |
| Net Margin | 2.13% | 675.00% | Weak |
| Debt/Equity | 1.17 | 0.70 | Weak (High Leverage) |
| Current Ratio | 1.50 | 3.94 | Neutral |
| ROA | 2.68% | -8240.00% (disorted) | Weak |
SIG outperforms its industry in 0 out of 6 key metrics, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Signet Jewelers Limited's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
39.84%
Industry Style: Cyclical, Growth, Discretionary
High GrowthEPS CAGR
250.18%
Industry Style: Cyclical, Growth, Discretionary
High GrowthFCF CAGR
-4.51%
Industry Style: Cyclical, Growth, Discretionary
Declining