JP Morgan Positive Ahead of Signet Jewelers Q1 Earnings

JP Morgan has published a research report on Signet Jewelers SIG commenting on the company's Q1 earnings. In the report, JP Morgan writes, "SIG will report Q1 earnings on Thursday, May 24, and while the group remains choppy this earnings season we feel investors should step in on this market-share leader ahead of the print. Reasons for our optimism stem from 1) the fact that the negative Q1 Mother's Day shift will turn into a positive Q2 shift (growth reaccelerating), 2) our checks indicate a recent round of price increases should give a boost to both margins and comps coming out of Q1, 3) we believe the negative UK comps in February bounced back in March/April, and 4) the return to share repurchases could illustrate management's confidence in the business. At just 10x and 9x (ex-cash) our 2012/2013 estimates, SIG represents one of the more compelling value names in our group, and with sentiment fairly negative today we would recommend purchase." JP Morgan maintains its Overweight rating and $55 price target on Signet Jewelers, which is currently trading down $3.67 from yesterday's $47.75 closing price.