Cramer Chats With Signet Jewelers About $360M Blue Nile Deal, Expanding Market Share

Zinger Key Points
  • Signet Jewelers operates approximately 2,800 stores, with its most recognizable branded names including Kay Jewelers and Zales.
  • Signet purchased online jewelry retailer Blue Nile in an all-cash transaction for $360 million.
Cramer Chats With Signet Jewelers About $360M Blue Nile Deal, Expanding Market Share

Signet Jewelers Ltd. SIG CEO Gina Drosos recently appeared on Jim Cramer’s ‘Mad Money’ to discuss the company's recent $360-million acquisition of online jewelry retailer Blue Nile.

The acquisition opens the Hamilton, Bermuda-based company up to "a new consumer cohort," Drosos explained. Blue Nile, which has been around for 20 years, recorded revenues of over $500 million in 2021 and is a pioneer of online engagement rings with the highest brand awareness out of any online pure-play retailer, she added.

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This isn't the first acquisition for Signet. In 2017, the company purchased James Allen for $328 million.

Drosos expects numerous back-office synergies between both companies.

Signet also operates some 2,800 stores under various banners, including Kay Jewelers, Zales, Jared, Banter by Piercing Pagoda, Diamonds Direct, Rocksbox, Peoples Jewellers, H.Samuel and Ernest Jones.

While Signet aims to provide consistent annual double-digit margins, there have been doubts in the past that this is possible during turbulent times.

However, the second-quarter earnings have shown otherwise.

Staying focused on capital allocation priorities is also essential, as Signet continues to grow market share by building new competitive moats of advantage through the digital space and collecting data that other jewelers cannot match, Drosos said.

The company has also cleared up past debts, Drosos says, calling Signet undervalued.

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Posted In: Jim Cramer Interview Signet CEOSignet AcquisitionsZale and Kay JewelersM&AMid CapNewsTechInterview