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Will Tiffany’s Stock Return to Growth on Q4 Earnings?


Mar. 12 2018, Published 8:08 a.m. ET

What to expect

Tiffany’s (TIF) is scheduled to announce its fiscal 4Q17 results on March 16, 2018. Analysts expect the company’s sales and earnings to see healthy growth thanks to its improved performance during the holiday season. As for the full year, analysts project the company’s top and bottom lines to return to growth after declines in the past two fiscal years (fiscal 2016 and 2015).

Tiffany’s top line is expected to benefit from its improved sales across major regions and product categories. Meanwhile, sales leverage, a focus on cost and productivity savings, and lower input costs are likely to drive double-digit EPS (earnings per share) growth in 4Q.

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YTD stock performance

Despite its stellar holiday sales numbers and strong 4Q17 earnings expectations, Tiffany’s stock is down about 2.1% on a YTD (year-to-date) basis as of March 9, 2018. The company’s muted 2018 outlook dented the stock.

Tiffany earlier provided its preliminary outlook for fiscal 2018. The company expects its adjusted EPS to remain flat or decline slightly on a YoY (year-over-year) basis in fiscal 2018. Tiffany plans to make investments in growth initiatives in fiscal 2018, which are likely to pressure margins and in turn, its EPS. The company earlier stated it plans to step up its investments in stores, its e-commerce platform, technology, and marketing, which could support its top-line growth rate.

In comparison, Signet Jewelers (SIG) stock is trading in the red and saw a 13.5% decline on a YTD basis. The company’s continued sluggishness on the top-line front weighed on its stock. Meanwhile, the S&P 500 Index is up about 4.2% on a YTD basis.


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