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Sep. 24, 2014, 8:13 AM
- Retail sales could increase by 4.5% to $986B this holiday season on an improved macroeconomic backdrop, forecasts Deloitte Touche.
- The mark would easily top last year's 2.8% rise.
- Online sales are tipped to rise by 14%.
- Promotional activity across broad retail has been dialed back a touch during the back-to-school season, but is still a risk to margins heading into the crucial shopping period.
- What to watch: This holiday season could be an operational pressure cooker for UPS (NYSE:UPS) and FedEx (NYSE:FDX) with demand expected to be high.
- Related stocks: AAP, AEO, ANF, BBBY, BBY, BJ, CHS, COH, COST, DG, FDO, FL, GPS, JCP, JNY, JWN, KSS, LB, LULU, M, NDN, PIR, RL, TGT, TIF, TJX, UA, URBN, VFC, WMT, ZLC, PERY, SQBG, VNCE, KORS, GIII, KATE, GIL, VRA, ICON, PSMT, AMZN.
- Related ETFs: XLY, XRT, VCR, RTH, RETL, IYK, FXD, FDIS, PMR, UGE, RCD, SZK
May 29, 2014, 5:22 PM
- Signet Jewelers (SIG) completes its $1.46B acquisition of Zale (ZLC) after winning approval from a majority of ZLC shareholders. overcoming opposition from some major shareholders (I, II) and proxy adviser Glass Lewis.
- SIG, already the largest U.S. operator of jewelry stores before the deal, is now nearly 3x bigger than the upscale Tiffany (TIF) in terms of U.S. sales, with a 14.6% market share.
- SIG says it expects the acquisition will increase its per-share earnings in the high single-digits on a percentage basis after a year, and generate cost savings of $100M after three years.
- SIG +3.5% in today's trade.
May 23, 2014, 6:16 PM
- Mario Gabelli becomes the second large Zale's (ZLC) shareholder to come out against the proposed sale to Signet (SIG), saying he may seek a second opinion on the deal's $21/share price in court.
- Gabelli, whose funds own 7.45% of ZLC, says in an SEC filing he had "commenced the process to be able to assert appraisal rights" - a legal process that lets shareholders reject a merger deal and instead ask a judge to independently value their shares.
- Another large Zale investor, TIG Advisors, is trying to rally opposition to the sale ahead of a vote set for next Thursday, but Golden Gate Capital, which controls 23% of ZLC, plans to vote in favor of the deal.
May 23, 2014, 3:08 PM
May 22, 2014, 7:15 AM
- Proxy service ISS recommends shareholders of Zale (ZLC) vote in favor of a sale of the company to Signet SIG.
- The deal is being struck at a fair price, according to ISS.
- The development is good news for Zale which just sent a letter to TIG Advisors defending the sale price in response to a heated back-and-forth discussion with TIG over the deal.
- Zale closed at $22.69 yesterday vs. the Signet offer of $21.
May 20, 2014, 8:16 AM
- Zale (ZLC): FQ3 EPS of $0.19 beats by $0.02.
- Revenue of $431M (-2.7% Y/Y) misses by $10.91M.
May 16, 2014, 1:07 PM
- The efforts of Signet (SIG +0.1%) to acquire Zale (ZLC +0.8%) could be done in by deal adviser Bank of America Merrill Lynch's failure to disclose a conflict of interest.
- BAML delivered a presentation to Signet last October in which it recommended to the company it make an offer to buy Zale for $17 to $21 per share. The investment bank then turned around to rep Zale in the merger talks while disclosing only "limited" prior relationships with Signet, according to The New York Times.
- The apparent foul-up gives TIG Advisors even more ammunition to convince other Zale shareholders to oppose the merger.
May 9, 2014, 5:54 PM
- Zale (ZLC) investor TIG Advisors urges shareholders to join it at a special May 29 meeting of shareholders in opposing a $1.4B takeover by Signet Jewelers (SIG), arguing that the $21/share offer is "grossly unfair."
- Instead of the price the two diamond sellers agreed upon, TIG says it should be able to get $28.60/share in cash and stock, according to an SEC filing from the 9.5% owner of ZLC shares.
- ZLC rose 3.2% today, rising sharply toward the end of the session after TIG filed its position; SIG closed 1% lower.
Feb. 27, 2014, 7:39 AM
- Zale Corporation (ZLC): FQ2 EPS of $1.13 beats by $0.09.
- Revenue of $656.45M (-2.1% Y/Y) in-line.
Feb. 19, 2014, 3:17 PM
- 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.
Feb. 19, 2014, 12:45 PM
Feb. 19, 2014, 9:13 AM
Feb. 19, 2014, 7:37 AM
- Signet (SIG) confirms its acquisition of Zale (ZLC) in a transaction valued at close to $1.4B. Large Zale stakeholder Golden Gate Capital is on board with the deal.
- The company expects to finance the transaction through bank debt and a securitization of its accounts receivable portfolio.
- The merger is expected to be accretive in the first year at a high single-digit percentage.
- What to watch: Zale's international business and strong online business strengthen a couple of areas Signet had room to improve. The combined company will also yield some improved pricing power.
- Premarket action: ZLC +40.8% to $20.99 and SIG +11.0% to $88.
Feb. 19, 2014, 7:24 AM
Jan. 10, 2014, 12:09 PM
- Shares of Zale (ZLC +14.2%) pop after the company surprises with its report on holiday sales.
- Comparable-store sales were up only 2% for the two-month period, but the company's margin trend looked strong.
- A read from MasterCard Advisors tipped off two weeks that jewelry would be a retail out-performer.
Dec. 27, 2013, 7:32 AM
- Holiday sales rose this year by 2.3% to easily top last year's 0.7% rise, according to fresh data from MasterCard Advisors. The mark falls short of the early projections from ShopperTrak and the NRF.
- Jewelry (ZLC, SIG, NILE, TIF) and children's clothing were two categories that showed strong gains.
- The shift to online channels was pronounced this year with mall traffic slow. Online sales for the holiday season were up at a double-digit pace, but also fell short of some forecasts.
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