Impact of Taylor Swift's Engagement Announcement on Jewelry Industry Stock Prices This Week

Taylor Swift's recent engagement announcement to NFL player Travis Kelce has sent ripples through the jewelry market, with a noticeable spike in internet searches for various types of wedding rings and a subsequent impact on the stock prices of some jewelry companies.

On Tuesday, Swift shared her engagement news on Instagram, revealing a cushion cut diamond ring. This announcement led to a brief, unexplained 1% pop in the stock price of Signet Jewelers Limited (SIG), a leading retailer of diamond jewelry. The company closed at $89.86/share on Thursday, 3.6% above its pre-engagement price but significantly lower than its post-engagement high of $95.

Signet Jewelers' gross margin is 39.39%, which is lower than that of Brilliant Earth Group, a competitor that offers ethically-sourced jewelry. Brilliant Earth Group's gross margin stands at 57.84%. Despite this, Brilliant Earth Group has lagged significantly, down by a jaw-dropping 130 percentage points over the past five years.

Brilliant Earth Group soared from $2.17/share at 12:50 PM on Tuesday to close at $2.82/share, a 30% gain, following the announcement. However, the volume of Brilliant Earth Group's shares on Thursday was 211,010, which is lower than its average volume of 1,096,045.

The first company offering a Taylor Swift-inspired cushion cut moissanite engagement ring is listed on Etsy, with the sale occurring on the Etsy platform.

Signet Jewelers' current market cap is $4B, while Brilliant Earth Group's current market cap is a more modest $43M. Signet Jewelers has trailed the S&P 500 by about 35 percentage points over the past five years.

The "Eras" tour has also been credited with record hotel revenues in Cincinnati and Chicago, among many other cities. Taylor Swift's "Eras" tour has been credited with the strongest month of hotel revenue in Philadelphia since the pandemic.

It is unclear whether certain traders' algorithms or Swifties among the ranks of hedge fund managers played a role in the stock market response to the engagement announcement. Movado Group and LVMH, which are partially exposed to the jewelry market, were both up more than 4% over their pre-engagement price at Thursday's close.

Brilliant Earth Group closed at $2.69/share on Thursday, which is above its pre-engagement price but lower than its post-engagement high. The exact impact of Swift's engagement announcement on the jewelry market remains to be seen, but it has undeniably sparked interest and activity in the sector.

Impact of Taylor Swift's Engagement Announcement on Jewelry Industry Stock Prices This Week