Engagement rings are in demand again after Covid trough

Signet Jewelers CEO Gina Drosos told CNBC’s Jim Cramer on Tuesday that marriage proposals are finally on the rise, years after Covid disrupted typical dating patterns and hurt the company’s business.

“We know a lot about dating couples, and so we feel quite confident that our predictions are right, and that the engagement trough has happened,” Drosos said. “We have a three-year tailwind behind us.”

Bridal jewelry, especially engagement rings, makes up about 50% of Signet’s sales, said Drosos. Signet owns several jewelry retailers, including Jared, Zales and Kay Jewelers. The company attributed poor sales in recent years to the slowed dating and stalled relationships brought on by isolation during the pandemic.

Drosos said the company predicted this year would be a trough, a low point, and explained that engagements are still down 25% compared to a typical pre-pandemic year. Yet, the company managed to top Wall Street’s estimates for earnings per share in its Tuesday quarterly report, and its stock was up more than 5% by Tuesday’s close.

Signet sees a greater number of betrothals on the horizon, citing data collected from its own surveys as well as from partners Google and Meta. The company tracks 45 “milestones” couples go through before getting engaged, including “late stage” ones like taking a trip or moving in together. Drosos said those categories grew over the last two quarters.

Signet’s surveys also suggest that younger generations have a greater desire to get engaged than in years past, she added.

“It turns out 80% of Gen Z and Millennial customers who aren’t married want to get engaged, and, in fact, that’s up from a survey that we did five years ago,” she said. “So, engagement is alive and well.”