Tiffany Shares Sparkle After Beat-and-Raise Quarter, $1B Buyback Announced

Retail earnings are in full swing and the reports from the sector have been fairly upbeat. Luxury retailer Tiffany & Co. TIF became the latest retailer to report above-consensus results for its fiscal first quarter.

Tiffany announced a $1-billion stock buyback program.

The positive news has propelled the stock to a new high.

EPS, Sales Fly Past Estimates

Tiffany's Q1 earnings jumped 53 percent to $142 million. On a per-share basis, earnings improved to $1.14 per share compared to 74 cents per share in the first quarter of 2017. 

Analysts, on average, were expecting a more modest 83 cents per share for the quarter.

Worldwide sales climbed 15 percent to $1 billion, thanks to 10-percent comps growth and broad-based strength. This exceeded the $958.17 million expected by analysts.

On a currency-neutral basis, sales and comps were up 11 percent and 7 percent, respectively.

Geographically, the Americas — which account for roughly 42.5 percent of total Tiffany sales — saw sales growth of 9 percent. The Asia-Pacific region contributed roughly 33 percent to the top line and reported sales growth of 28 percent, and Greater China and most other markets outperformed. 

Sales in Japan and Europe grew 17 percent and 13 percent, respectively.

Tiffany's gross margin expanded by 0.9 percentage points to 63 percent.

Guidance Revised Higher 

Citing the stronger-than-expected Q1 results, the company increased its full year guidance. Tiffany now expects worldwide net sales to increase by a high single-digit percentage and net earnings per share to come in at $4.50-$4.70.

The consensus expectations call for 5.6-percent sales growth and earnings per share of $4.42.

The company guided for mid-to-high-single-digit comps growth and a 2-percent increase in worldwide retail square footage.

Tiffany shares were surging 15.61 percent to $118.20 at the time of publication Wednesday morning. 

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