Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Quick Hits: Tiffany Takes a Hit


Brief scrutiny of today's headlines.

Tiffany & Co. (TIF) slashed its full-year earnings forecast, underscoring the worst: Even upscale consumers have been hit by the economic downturn and this year's holiday season is likely to be the weakest since the early 1990s.

The basic question of when consumer confidence will be restored can be answered with a stock reply for the immediate future: Who knows, but not soon.

The New York-based upscale jeweler says it expects full year earnings to be $2.30 to $2.50 a share on a flat sales, or a decline of 2%. Previously, the company looked for sales growth of 9% and earnings of $2.82 to $2.92 a share.

Like other companies, Tiffany plans to cut staff and trim costs in response to the downturn. It also will reduce the number of new store openings next year. It operated 204 stores on October 31.

In the third quarter, Tiffany's profit fell to $43.8 million, or 35 cents a share, from $101.5 million, or 73 cents, for the same period a year ago. Analysts expected the company to earn 24 cents a share.

Tiffany's said worldwide sales fell 1% and stores open at least one year declined 7%.

Investors looking at retail stocks might want to consider Wal-Mart (WMT). The nation's largest retailer has cut prices on groceries, consumer electronics and selected items to pull in wary shoppers.

It seems odd to assume that Tiffany's would be recession-proof. It deals in discretionary goods – things that can easily be cut in an economic crunch with little pain. Still, the company's fortunes are a good barometer of upscale consumer sentiment.

So, anyone planning breakfast at Tiffany's might want to brown bag it.
No positions in stocks mentioned.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Featured Videos