Please ensure Javascript is enabled for purposes of website accessibility

Why Did Signet Jewelers Stock Gain Over 26% On Friday?

By John Rosevear - May 9, 2020 at 11:44AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Stores are reopening, but is something else going on?

What happened

Shares of Signet Jewelers (SIG 0.17%) surged on Friday, after a trade publication reported that the company has reopened over 100 of its stores in states that have loosened coronavirus-related restrictions.

Signet's shares ended Friday's session at $11.09, up 26.9% from Thursday's close. But despite Friday's gain, they're still down by over half since the beginning of March.

SIG Chart

SIG data by YCharts. Chart shows the change in price of Signet Jewelers' shares from March 1, 2020, through the market's close on May 8, 2020. 

So what

It seems only fair to say this up front: It's not entirely clear, to me at least, what was driving Signet's huge gain on Friday. But we do know that the company has begun reopening its jewelry stores, and that news broke on Friday morning.

Jewelry trade publication JCK reported on Friday that Bill Luth, Signet's executive vice president of store operations, said that Signet had reopened 114 stores to customers as of Friday, with another 55 open for curbside pickup. The reopened stores are in states that have loosened restrictions meant to slow the spread of the coronavirus, including Colorado, Florida, Georgia, South Carolina, and Texas, Luth told JCK.

Rings in a jeweler's display case.

Image source: Getty Images.

News that stores are reopening is obviously good news for Signet and its shareholders. But given that Signet has over 2,600 stores in the United States -- it owns the Zales, Kay Jewelers, and Jared chains, among others -- that have been closed since mid-March, it doesn't seem like the kind of news that would drive a nearly 27% jump in the company's stock price. 

Now what

As most stock investors know, there are times when stocks jump for no good reason. But there are also times when stocks jump (or crash) on rumors of pending news.

I spent some time looking into this on Friday and didn't turn up anything worth reporting (except for the JCK report above). But investors in Signet might want to keep an eye out for interesting news next week, just in case. 

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Signet Jewelers Limited Stock Quote
Signet Jewelers Limited
SIG
$53.55 (0.17%) $0.09

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
316%
 
S&P 500 Returns
112%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 07/05/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.