- The merger between Signet (SIG +18.5%) and Zale (ZLC +40.2%) gives the combined company extra clout when sourcing its products, according to Citigroup.
- The investment firm also likes the ability of brands to be cross-sold in new channels and for the jewelry sellers to strike synergies in key areas.
- A rationale reduction of Zale's store count will create even more upside.
- The clash of cultures shouldn't be too great with execs swapping back and forth between Zale and Signet over the years. Zale’s non-executive chairman, Terry Burman, is former Signet CEO.