suteishi In an ideal world, any company that you invest in would go on to generate even better fundamental performance than it had in the past. But the beautiful thing about value investing is that you don't always need this to occur in order to achieve upside, particularly if the shares that you purchase are done so at a very low trading multiple. A great example of this can be seen by looking at a behemoth in the jewelry market known as Signet Jewelers ( NYSE: SIG ).
From 2023 through 2024, the company saw revenue and some of its cash flow figures worsen. And when it comes to the 2025 fiscal year that the business is now in, some pain is expected to continue. You would think that a company experiencing this kind of trouble would see some pain from a share price perspective as well.
But because of how cheap the stock is, market participants haven't been able to get enough of it. Since I last rated it a ‘buy’ back in August of 2023, shares of the company have skyrocketed by 80%. That dwarfs the 18.
6% increase seen by the S&P 500 over the same window of time. You would think, given this upside and the pressure the firm has seen from a fundamental perspective, that I would now turn neutral or bearish on the business. However, I would argue that just enough upside still exists to warrant the ‘buy’ rating remaining in place.
A great price Fundamentally speaking, things have not been particularly pleasant for Signet Jewelers. Consider financial performance from 2023 to 202.
