Michael Hill (ASX:MHJ) share price rockets 13% to a 52-week high. Here’s why

What’s pushing the jeweller’s shares higher?

| More on:
A woman wearing a top of gold coins and large gold hoop earrings and a heavy gold bracelet stands amid a shower of gold coins with her mouth open wide and an excited look on her face.

Image source: Getty Images

The Michael Hill International Ltd (ASX: MHJ) share price is storming to a fresh 52-week high today. The company provided investors with a trading update following an early indication of performance for the half-year of FY22.

At the time of writing, the specialist retail jewellery chain’s shares are up 13.22% to $1.285 apiece. In contrast, the All Ordinaries (ASX: XAO) is travelling 1.03% higher to 7,824.2 points.

How is Michael Hill performing for H1 FY22?

Investors are driving up the Michael Hill share price after the company revealed a positive business update despite COVID-19 challenges.

According to its announcement, Michael Hill advised it has delivered sales growth and sustained margin exposure throughout November and December. This comes after management navigated the business through extended periods of store closures across Australia and New Zealand from July to November.

Regardless of the rise in COVID-19 cases around the globe, all stores were open during the critical Christmas trading period.

The company has a total of 285 stores across all markets in Australia, New Zealand, and Canada.

Michael Hill anticipates the strong performance to exceed its first-half expectations, particularly against earnings before interest and tax (EBIT). Previously, the company achieved EBIT for H1 FY21 of $44.6 million.

While its second-quarter trading update will be released on 14 January, all eyes will be on its key operating metrics.

Furthermore, the company’s first half of the FY22 financial results will be delivered on 23 February 2022.

Michael Hill share price snapshot

In the past 12 months, Michael Hill shares have boasted a gain of more than 92% from continued positive investor sentiment. The company’s share price charged higher since October following a sound first-quarter trading update for FY22.

Based on today’s price, Michael Hill commands a market capitalisation of around $500 million, with roughly 388.29 million shares outstanding.

Should you invest $1,000 in Michael Hill right now?

Before you consider Michael Hill, you'll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Michael Hill wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of January 13th 2022

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Consumer Staples & Discretionary Shares

man at casino throwing chips in the air
Broker Notes

Why the Aristocrat share price is surging again today

The gain comes on top of its 6.7% surge yesterday.

Read more »

Supermarket trolley with groceries going up the stairs with a rising red arrow.
Consumer Staples & Discretionary Shares

Woolworths share price lifts following $218m online marketplace deal

The supermarket giant is gaining alongside the ASX 200 on Friday.

Read more »

Sad person at a supermarket.
Consumer Staples & Discretionary Shares

Why is the Woolworths share price sliding 7% today?

Aussie investors heed Target's inflationary warning...

Read more »

Supermarket trolley with a red arrow pointing downwards, symbolising a falling share price.
Consumer Staples & Discretionary Shares

Here’s why the Coles share price is tumbling 5% today

Could recession talk be impacting the supermarket's stock?

Read more »

wine share price rising represented by two people raising wine glasses
Consumer Staples & Discretionary Shares

Treasury Wine share price beating the sell-off amid ‘made in China’ push

Let's take a closer look.

Read more »

A woman leaps into the air with loads of energy, in a lush green field.
Consumer Staples & Discretionary Shares

Own Woolworths shares? The company’s about to hit a major sustainability milestone

Woolies' South Australian operations are set to switch off from fossil fuels in July thanks to a new partnership.

Read more »

A trader stand looking at a sharemarket graph emblazoned with the words buy and sell
Consumer Staples & Discretionary Shares

Could the Wesfarmers share price have already bottomed?

Could Wesfarmers shares be in the buy zone today?

Read more »

Woman thinking in a supermarket.
Consumer Staples & Discretionary Shares

Why I think Coles is a better ASX dividend share than Woolworths

Are Coles shares a better pick for dividends than Woolworths?

Read more »