Tuesday, November 23, 2010

Tiffany & Co. (NYSE: TIF): Q3 Earnings Preview 2010

Tiffany & Co. (NYSE: TIF) is scheduled to release its third-quarter earnings before the opening bell on Wednesday, November 24, 2010. Analysts, on average, expect the company to report earnings of 37 cents per share on revenue of $653.32 million. In the year ago quarter, the company reported earnings of 33 cents per share on revenue of $598.21 million.

Tiffany & Co., through its subsidiaries, engages in the design, manufacture, and retail of fine jewelry. The company also sells timepieces, sterling silverware, china, crystal, stationery, fragrances and accessories. 

The company has benefited from improved demand for luxury items. Tiffany holds a significant position in the world jewelry market and is poised to benefit from its increased geographic reach. The company expects to open 14 stores worldwide in 2010. Over the next five years, the company plans to open upwards of 20 new stores in China to go along with six in the Americas and three in Europe. The company has also been concentrating more on smaller-sized store formats that offer selected collections of lower-priced, higher-margin products.

In the preceding second quarter, the New York-based company's net income was $67.7 million, or 53 cents a share, compared to a profit of $56.8 million, or 46 cents a share, in the prior-year quarter. Revenue increased 9.2% to $668.8 million from $612.49 million in the same quarter last year. Analysts, on average, expected the company to report earnings of 53 cents per share on revenue of $690.24 million. 

At its last earnings call in August, the company boosted its fiscal 2010 earnings guidance to a range of $2.60 to $2.65 per share, from the prior outlook of $2.55 to $2.60 per share. The company anticipates fiscal 2010 worldwide sales growth of about 11%. By region, the company anticipates 10% sales increase in the Americas, the low single digit percentage decline in Japan, a mid 20s percentage sales increase in Asia Pacific, a mid teens percentage increase in Europe, and other sales up modestly over last year. The company expects about 1.5 point increase in gross margin. 

In terms of stock performance, Tiffany shares are up more than 35% since the beginning of the year. 

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