American-based bling brand names such as WhitehallJewellers (NYSE:JWL), Zale (NYSE:ZLC), and Tiffany (NYSE:TIF) have had a mixed bag lately: some good results, some turnaround growth, and some plain-old same-olds. Of course, there's also been major growth at online diamond-hawker Blue Nile (NASDAQ:NILE), a Motley Fool Rule Breakers pick, but that's another beast entirely.
For some reason, we investors seem to pay a bit less attention to a couple of the jewelry biz's bigger names: Kay Jewelers and Jared, the Galleria of Jewelry. Around here, commercials for these two air constantly, yet the shares of their parent, Signet Group PLC (NYSE:SIG), are rarely on my mind. That's largely because Signet is organized all the way across the Atlantic in England.
Investors ought to drop that bias, because Signet is doing big business in the United States. A full 70% of revenues come from this side of the pond, and that percentage is likely to grow. U.S. comps growth, or same-store sales, improved a healthy 7.1% in Q1, outrunning overall comps growth of 3.3%. (That 7.1% is much snazzier than the recent, decent results from Zale, but a bit below the bling-slinging by the U.S. segment of Tiffany.) Signet's total sales were up 4.9% -- which would have been 7%, if not for currency fluctuations -- reaching 369 million pounds, or about $698 million.
The U.K. side of the business underperformed, with comps down 6% and overall sales falling 5% to 91.3 million pounds. Despite the tougher U.K. retailing climate, the group's final profit ticked up 10%.
With good-looking balance sheets and a steady, if not fiery, business growth, U.S. investors who are confident in American buying power and interested in cashing in on the luxury craze could do worse than check into this shiny Brit. At a P/E around 13, it trades at a slight discount to many of the above-named peers, yet sports better net margins than all but Tiffany. Couple that with two very strong U.S. brand names and a decent dividend yield (at 2.9%) and this is one jeweler worth a closer look.
For related flawless Foolishness:
- Blue Nile's growth is gaga. Does it justify the stock's price?
- Check out another way that diamonds could be a Fool's best friend.
- Whitehall's shares stay tarnished.
- Zale recently rang up some growth.
Selling diamonds online: Crazy? Genius? Or both? If you'd like a peek at other companies aiming for super-growth by going against the flow, take a 30-day trial of Motley Fool Rule Breakers . It's on the house.
The only diamonds Seth Jayson buys are the little black ones on grinding wheels. Although he's interested in diamond stocks, at the time of publication, he had no position in any company mentioned. View his stock holdings and Fool profile here . Fool disclosure rules are here .
