Summary
Signet Jewelers offers investors a retail route into the lab-grown diamond shift as natural diamond prices sit at record lows in 2026. The investment split is becoming clearer: falling mined-stone values pressure the traditional diamond market, while lower-priced lab-grown products can support jewelry retailers through higher tickets and stronger industry-level margins.
Rapaport Group data put the average price of a 1-carat natural diamond at $3,898, down 51% from $8,007 in 2021. At the retail counter, The Knot 2026 Real Weddings Study found that lab-grown center stones represented 61% of engagement-ring sales in 2025, an increase of 239% since 2020.
Natural Diamond Prices Reach Record Lows
Natural diamonds have lost more than half their value over the past five years, according to CNBC. The Diamond Standard Index, a measure of investment-grade diamond prices, reached a record-low 2,490 index points in early August 2026 and stood just above 2,500 during the week of the CNBC article dated 2026-09-26.
The pressure reflects excess mined-stone inventory and the adoption of cheaper lab-grown alternatives. Diamond Standard CEO Cormac Kinney identified 2023 and 2024 as the period when excess natural-diamond inventory persisted after excess production during Covid. That inventory overhang matters because producers and sellers must clear existing stones as consumers gain access to a lower-cost product with the same chemical and physical properties.
Lab-grown diamonds are stones made by applying heat and pressure to carbon seeds or by using carbon-containing gas in a vacuum chamber. Their physical equivalence shifts the purchase decision toward price, size and appearance rather than requiring buyers to accept a visibly different product.
Brilliant Earth Shows the Consumer Price Gap
A CNBC search of Brilliant Earth's online marketplace found a lab-grown diamond listed for $450 in 2026. A natural diamond with the same specifications cost $2,800 to $3,200, and lab-grown alternatives were cheaper at every carat weight available on the marketplace.
A man-made stone could cost 90% less than its mined equivalent in 2026, with the precise gap depending on size, cut and color. That difference lets consumers seek a larger-looking center stone without paying the natural-diamond price, redirecting demand away from mined inventory even when the jewelry purchase itself remains intact.
Cory Schifter, owner of Casale Jewelers, described customers moving beyond a 1-carat center stone designed to resemble a 3-carat stone. In his account, choosing lab-grown can preserve money that otherwise might have gone toward a 5-carat natural diamond. For retailers, the critical point is not simply that shoppers spend less per stone; it is that affordability may widen the set of products and sizes they consider.
Fortune Business Insights valued the lab-grown diamond market at $29.46 billion in 2025 and projected it would approach $92 billion by 2034, an increase of more than 200% from 2025. That projection is not a guarantee, though the engagement-ring mix reported by The Knot shows that adoption was already material in 2025.
De Beers Group Cuts Supply as Inventory Meets Competition
Natural-diamond producers are responding through capacity reductions. De Beers Group, the diamond-focused subsidiary of Anglo American, said in July 2026 that production at its flagship Venetia mine would stop for more than two years. At least two diamond mines also announced permanent shutdowns in 2026.
Kinney said two mines had filed for bankruptcy and one De Beers mine had been announced for closure. He also reported price appreciation in the wholesale market for certain diamond qualities, which supplies a counterpoint to the record-low broader index.
The distinction between selective wholesale appreciation and a market-wide recovery is essential. Reduced output can tighten availability, but the available evidence does not establish whether supply cuts will end the decline in natural diamond prices. Investors should therefore separate improvement in particular qualities from confirmation that the overall inventory imbalance has cleared.
Signet Jewelers Turns Lab-Grown Demand Into Retail Mix
- Signet Jewelers: Raymond James analyst Rick Patel held an outperform rating and said fashion products containing lab-grown diamonds generated three times the average unit retail of fashion products without them in 2026. Higher average unit retail can support same-store sales when customers accept added stones as added value.
- Kay Jewelers and Zales: These Signet brands are adding lab-grown diamonds to fashion items such as tennis bracelets. The mechanism is product mix: incorporating lab-grown stones can raise the selling price of an otherwise simpler piece.
- Brilliant Earth: Its marketplace displays the price separation between lab-grown and comparable natural stones. CNBC reported that the stock declined 20% year to date in 2026, despite gaining 27% over the past three months, leaving the equity signal less decisive than the product-price evidence.
- Pandora: Its own lab-grown diamond line gives the company exposure to the category. CNBC reported that Pandora gained nearly 19% from the beginning of 2026; its shares trade in Copenhagen and are also available to U.S. investors over the counter.
Gordon Brothers estimated 2026 gross margins of 60% to 65% for lab-grown diamonds, compared with 40% to 45% for natural diamonds. Those are category-level figures, not disclosed Signet margins: Signet did not answer questions about its own margins for either type of diamond.
The company-specific evidence is still constructive. Signet raised its annual profit forecast after strong demand for bridal and fashion products. Its shares had gained 21% in 2026 and surged 24% on Sept. 9, their best trading day in nearly four years, after the forecast increase.
Bull and Bear Cases for Diamond Retail
Bull case: Lab-grown adoption can lift retail economics when an affordable stone raises the average unit retail of a fashion product. Signet's forecast increase, Patel's three-times average-unit-retail comparison and Gordon Brothers' category margin data form a coherent mechanism: consumer value can coexist with a more profitable product mix for the seller.
Bear case: Natural-diamond price weakness could keep eroding the perceived scarcity behind mined stones, and lower lab-grown prices do not automatically translate into better results for every retailer. Company-level margins remain undisclosed, Brilliant Earth's year-to-date share decline shows that category exposure alone is insufficient, and future natural-diamond prices cannot be established from current supply reductions.
The physical stone also has weak investment characteristics. Diamonds lack a standardized spot market, and variations among stones complicate comparable valuation. CaratX reported in February 2026 that a diamond could remain on the secondary market for more than a year depending on quality; several jewelers' websites indicated that resold stones often fetched less than half their original retail price.
Schifter warned against treating a diamond as a financial investment and pointed instead to silver or the S&P 500. The relevant equity thesis is therefore retail execution, not appreciation of the underlying gemstone.
Investor Checkpoints After the Diamond Price Slide
- Track Signet's product mix: At the next company update, test whether lab-grown fashion jewelry continues to raise average unit retail and support same-store sales.
- Demand company-level margin evidence: Compare any future Signet disclosure with Gordon Brothers' 60% to 65% lab-grown and 40% to 45% natural-diamond category ranges.
- Watch the Diamond Standard Index: A move away from the 2,490 record low must broaden beyond selected qualities before it can support a stronger natural-diamond recovery case.
- Follow physical supply: Assess whether the De Beers Group Venetia halt and permanent mine shutdowns reduce excess inventory enough to offset continued lab-grown adoption.
Market data check: Signet Jewelers Limited
Signet Jewelers Limited last traded near $102.26 (+1.75%). Our composite signal — blending price momentum and news flow — reads 🟡 neutral. Price momentum scores 64/100 (firm).
Data as of publication. Price via market feeds; for reference only, not investment advice.
📊 Analysis
Signal Bullish
Why Signet Jewelers has exposure to higher-ticket lab-grown fashion jewelry, while its raised annual profit forecast provides company-specific evidence of resilient demand.
This article was independently written by OneDayTrading from public reporting. Read the original (CNBC)
