Tiffany & Co. (TIF) Stock Lower after Earnings, Guidance

Shares of Tiffany & Co. (TIF) were trading down -4.13 or -5.40 percent to $72.42 per share in Tuesday’s premarket after the company released its fiscal third quarter earnings, which missed analyst forecasts earlier this morning. Tiffany & Co. stock closed at $76.55, up +1.41 or +1.88 percent in Monday’s regular trading session.

New York City based Tiffany & Co., founded in 1837 is a U.S. multinational jeweler and luxury retailer.
Through its stores and direct-mail marketing, the company sells jewelry, china, crystal, sterling silver, fragrances, stationary and personal accessories. The company is known for selling luxury goods and has a reputation for its diamond jewelry. Tiffany’s flagship store is located at the corner of Fifth Avenue and 57th Street in Manhattan, New York City.

For Tiffany & Co.’s third quarter ended on October 31st, the company reported net earnings of $91 million or $0.70 per diluted share compared to $99 million or $0.76 per diluted share in the same period one year ago. Last year’s results omit a pre-tax charge of $94 million, or $61 million and $0.47 per share after tax for the extinguishment of debt in relation to the prepayment of $400 million in long term debt, which resulted in last year’s third quarter net earnings of $38 million or $0.29 per diluted share.

On a constant exchange rate basis, worldwide net sales increased +4 percent, while comparable store sales rose +1 percent, in part due to higher sales in Japan, Europe and Asia-Pacific, which offset lower sales in the Americas. As reported in U.S. Dollars, worldwide net sales came to $938 million versus $960 million in last year’s third quarter. Analysts expected the company to report earnings of $0.75 on $971 million in revenue.

Frederic Cumenal, Tiffany’s Chief Executive Officer, said in this morning’s press release that, “As expected, the strong U.S. dollar continued to put pressure on our financial results, specifically from the translation of non-U.S. sales into dollars and on foreign tourist spending in the U.S. In addition, we believe that volatile, uncertain economic and market conditions in the U.S. and other regions are affecting consumer spending, causing us to maintain a cautious near-term outlook. However, focusing on what we can control, were pleased with our progress this year in expanding our store base and introducing and communicating compelling new product designs. And we are focused on efforts to manage our operations and inventories more efficiently to enhance cash flow.”

Results for the company’s first nine months had worldwide net sales of $2.9 billion, -2 percent below last year, nevertheless, on a constant currency basis, worldwide net sales increased +4 percent, while comparable store sales increased +2 percent. Net earnings year to date were $307 million, or $2.37 per diluted share compared to $349 million or $2.69 last year, a decline of -12 percent.

Due to third quarter results and the negative effects of the strength of the U.S. Dollar, as well as increased global uncertainties, Tiffany is now expecting full year earnings to be -5 to -10 percent below last year’s $4.20 per diluted share, excluding some items. The analyst consensus was for the company to make $4.04 for the full year, or -4 to -5 percent lower than the previous year.

Tiffany shares have recovered somewhat in this morning’s premarket; however the stock is still off about -3 percent before the opening bell. Tiffany stock has declined almost -30 percent this year and will open just above its yearly low price of $73.09.

Other News About TIF

Tiffany Declares Regular Quarterly Dividend

Company will pay a dividend of $0.40 to shareholders of record December 21st, 2015.

Tiffany's Potential Reward Now Shinier Than Its Risk

Article suggesting Tiffany’s stock could be a buy after declining -30 percent so far this year.
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Published on Nov 24, 2015
By Jay Hawk
Jay Hawk
Jay Hawk enjoyed a 12-year professional financial markets career incorporating extensive first hand futures and options experience obtained by trading in the stock, commodity and forex markets on U.S. exchanges. Since retiring as a full-time financial market professional, he has been actively trading stock, commodities, forex and options for his own account and managing funds for others, as well as writing financial market commentary and educational articles.

Copyrighted 2016. Content published with author's permission.

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