Tiffany shares nosedive after dismal holiday report

Global sales only rose 4% in November and December. That wasn't good enough for the company or its investors.

By Jonathan Berr Jan 10, 2013 11:10AM
Image: Diamond ring ( Lew Robertson/Corbis)Shares of Tiffany (TIF) were down 5% in morning trading after the iconic luxury retailer reported lackluster holiday sales and slashed its earnings outlook.

Worldwide sales at Tiffany increased 4% to $992 million in the two-month period ending Dec. 31. The company, which posted a 7% increase during the same period a year earlier, clearly expected better.

Strength in the Asia-Pacific region, which posted a 13% gain, failed to overcome the weakness in the Europe and the Americas, where sales rose 2% and 3% respectively.

"Holiday period sales growth was at the low end of our expectations," said Michael J. Kowalski, chief executive officer, in a press release.

The company now expects earnings at the low end of its previous forecast of $3.20 to $3.40 per share for the fiscal year ending Jan. 31. Analysts surveyed by Bloomberg on average expected earnings of $3.31. Tiffany is forecasting net earnings growth of 6% to 9%. The company will provide more details regarding its outlook when it reports its full-year results in March.

Tiffany wasn't the only retailer in Wall Street's doghouse Thursday. Aeropostale (ARO) shares also plunged after the retailer of casual apparel for young people slashed its fourth-quarter earnings outlook on disappointing holiday sales, MarketWatch reported.

Jonathan Berr does not own shares of the listed stocks. Follow him on Twitter @jdberr.


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Jan 10, 2013 3:02PM

This is stupid sales increased at what appears to be a sustainable rate but it's not good enough for investors.  Guess a company that grows slow and maintains its image and quality is a thing of the past because you can't make a quick buck on it.

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