Four Reasons Tiffany Is Dazzling Investors
The dividend is sparkling, and shares could move higher from here.
Asian stocks rose overnight. The Hang Seng and the Nikkei were up 0.67% and 0.31%, respectively. European stocks were in positive territory early this morning, too. And here in the US, we're currently trading lower.
Here's what I'm seeing this bitter cold Wednesday morning:
Bank of America-Merrill upped its rating on the jewelry giant.
1. I'm not jumping up and down about the shares or the upgrade. However, the company has been performing as of late, slicing through estimates like a diamond cutter.
2. I'm feeling pretty good about its potential to come in ahead of the $1.13-a-share estimate for the fourth quarter, too.
3. Let's not forget about that sparkling dividend.
4. I think the shares move higher from here.
The company was out with its first-quarter numbers. It put up $0.47 a share, excluding items, which was dandy because the Street was at $0.38. A healthy bump-up in operating income in its studio business helped gas results.
1. I've been a big fan of Disney for a while now and nothing's changed (see Why Now Is a Good Time to Play Disney). If it can put up a good number like this in what's still a lousy environment, I can only fathom what it might kick out when the economy really starts humming.
2. Over the next few quarters I'm thinking that its consumer products and parks & resorts segments will start to contribute in a much more meaningful way, and that the earnings outlook could improve from here. Not to mention that the ad environment should show us a pulse, too.
3. Note that the company has now thumped estimates four quarters in a row. I think that will put it squarely on a few radar screens in today's session. My hunch is that we break and close north of the $30 level.
The search engine company was out with its fourth-quarter numbers after the bell last night. It put up $1.80 a share, which was way better than the $1.68 analysts were expecting. It beat on the top line too, and it offered up a pretty rosy outlook for the first quarter.
Things have been going good for Baidu. It's whipped estimates the past few quarters, its stock has been on a nice roll, and people seem to be all jazz hands about the future.
However, the shares have come an awful long way in a seriously short period of time. And my biggest worry is what could happen if the company misses expectations or goofs up. I think the stock would get creamed. Don't get me wrong -- I'm impressed with the earnings growth potential this company has. But with an estimate of just $8.92 a share for this year, I'm not ready to belly up -- regardless of whether the shares get a nice goose in early trading.
Justin Sharon points out this morning in his article that Goldman slapped a Neutral rating on the bank.
I wasn't excited about the company or stock when it was trading in the low single-digits (around the $5 level) and I'm not now. Why should I belly up? The markets and the economy are still iffy and the near-term earnings outlook isn't all that impressive. If I were going to snuggle up to a big name in this space, I'd rather go with JPMorgan Chase (JPM).
For my last take on Citi, click here.
Have a great day!
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