Earnings Cheat Sheet: Tiffany Sparkles Ahead of Holidays

Earnings: Increased by 26.4% to $.43 per share, or $55.1 million, compared to $.34 per share, or $43.3 million, in the same period a year ago.

Revenue: Increased 14% to $681.7 million.

Actual versus Wall Street Expectations: Earnings of $.43 cents per share beat expectations by $.06 cents.  The consensus analyst earnings expectation was $.37 cents per share. Revenues easily exceeded the expected $652.8 million revenue estimate (Thomson Reuters).

Notable Stats: Sales in Asia-Pacific increased 24%.

Sales in Europe increased 22%.

Gross margin was 58.5% in the third quarter, compared with 54.8% last year.

Cash and cash equivalents and short-term investments of $529.5 million at October 31, 2010 were higher than $374.9 million a year ago.

Tiffany raised its full-year earnings outlook to $2.72 to $2.77 per share from $2.60 to $2.65. Analysts expect $2.64 per share.

Did You Hear That? Mark Aaron, Vice President of Investor Relations, said, “During the third quarter we opened new stores in Baltimore, Maryland, in the Towson Center, and in Santa Monica, California, in Santa Monica Place, and are very pleased with initial results. And just earlier this month, we opened our jewel salon in the New York flagship store where we invite our highest spending clients from throughout the world to see our statement jewelry collection in a luxurious new environment.”

Commentary: Shares of Tiffany are achieving 52-week highs. After shattering analyst expectations, TIF shares continue to climb and further deviate from its 50-day and 200-day moving averages. With 24% growth in the Asia-Pacific region, TIF is tapping into a high growth market and seeing the results hit its bottom line quickly. After a fast run-up in shares, the possibility of a cool-off or price pullback increases. So, if you’re looking to jump on board the TIF train, you may want to wait for a better entry point. On the other hand, with the high demand for precious metals, TIF could see further upside momentum.

Disclosure: No positions

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