Advertisement
Singapore markets closed
  • Straits Times Index

    3,224.01
    -27.70 (-0.85%)
     
  • Nikkei

    40,350.59
    +182.52 (+0.45%)
     
  • Hang Seng

    16,541.42
    +148.58 (+0.91%)
     
  • FTSE 100

    7,952.62
    +20.64 (+0.26%)
     
  • Bitcoin USD

    70,717.55
    +834.94 (+1.19%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • S&P 500

    5,254.35
    +5.86 (+0.11%)
     
  • Dow

    39,807.37
    +47.29 (+0.12%)
     
  • Nasdaq

    16,379.46
    -20.06 (-0.12%)
     
  • Gold

    2,254.80
    +16.40 (+0.73%)
     
  • Crude Oil

    83.11
    -0.06 (-0.07%)
     
  • 10-Yr Bond

    4.2060
    +0.0100 (+0.24%)
     
  • FTSE Bursa Malaysia

    1,530.60
    -7.82 (-0.51%)
     
  • Jakarta Composite Index

    7,288.81
    -21.28 (-0.29%)
     
  • PSE Index

    6,903.53
    +5.36 (+0.08%)
     

Tiffany's (TIF) Efforts Place the Stock Favorably for 2018

Tiffany & Co. TIF is well positioned to augment both its top and bottom-line performance in the long run by leveraging capital investments made over the past several years in distribution, manufacturing and diamond sourcing processes. The company is steadily introducing new jewelry designs, new watch collection and fragrance, as well as additional jewelry SKUs. It also introduced “build-your-own program” on its website under which customers are allowed to personalize their own charm bracelets.

The company is also focused on opening smaller stores that offer selected collections of lower priced higher-margin product, which in turn boosts store productivity. Tiffany concentrates on improving sales per square foot through an increase in customer traffic and converting them into potential buyers by targeted advertising, ongoing sales training and customer-oriented initiatives. Management anticipates gross retail square footage growth of 2% in fiscal 2017.

These initiatives seem inevitable given the company’s dwindling comparable-store sales performance. In the first, second and third quarters of fiscal 2017, comps have declined 3%, 2% and 1%, respectively. However, we noted that the rate of decline has decelerated sequentially.

Further, management had earlier guided SG&A expenses for the fiscal year to increase at a marginally higher rate than sales on account of sustained investment in new signature women's fragrance, launch of new luxury accessories offerings and additional jewelry SKUs. This may strain margins to an extent. We noted that in the first, second and third quarters of fiscal 2017, SG&A expenses had increased 0.2%, 3.7% and 3.3%, respectively.



Nevertheless, Tiffany is leaving no stone unturned to attract consumers and attain incremental revenues. The company envisions net sales for fiscal 2017 to increase by a low-single-digit percentage on a reported and constant-exchange-rate basis. We believe that these strategies are likely to bolster performance and drive the stock further. In the past three months shares of this Zacks Rank #3 (Hold) have increased 13.2%, outperforming the industry’s growth of 5.8%.

Interested in Retail? 3 Picks You Can’t Miss

G-III Apparel Group, Ltd. GIII delivered an average positive earnings surprise of 6.1% in the trailing four quarters. It has a long-term earnings growth rate of 15% and a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Ross Stores, Inc. ROST delivered an average positive earnings surprise of 5.5% in the trailing four quarters. It has a long-term earnings growth rate of 10% and a Zacks Rank #2.

Wal-Mart Stores, Inc. WMT delivered an average positive earnings surprise of 2.2% in the trailing four quarters. It has a long-term earnings growth rate of 6.1% and a Zacks Rank #2.

Investor Alert: Breakthroughs Pending

A medical advance is now at the flashpoint between theory and realization. Billions of dollars in research have poured into it. Companies are already generating substantial revenue, and even more wondrous products are in the pipeline.

Cures for a variety of deadly diseases are in sight, and so are big potential profits for early investors. Zacks names 5 stocks to buy now.

Click here to see them >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Wal-Mart Stores, Inc. (WMT) : Free Stock Analysis Report
 
Ross Stores, Inc. (ROST) : Free Stock Analysis Report
 
Tiffany & Co. (TIF) : Free Stock Analysis Report
 
G-III Apparel Group, LTD. (GIII) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.