KeyBanc: Tiffany CEO Making 'Bold Moves To Accelerate The Business'

Analysts urge investors to be optimistic of luxury jewelry retailer Tiffany & Co. TIF, based on significant long-term growth opportunity and a highly attractive valuation following upbeat investor meetings.

The Analyst

KeyBanc Capital Markets analyst Edward Yruma reiterated an Overweight rating and a $150 price target.

The Thesis

Tiffany is increasing visit frequency and conversion, through the implementation of elevated marketing spending, relevant messaging and product newness.

“TIF is accelerating the cadence of product line introductions from one new collection every 3-4 years to introducing one every 1-2 years, doubling the velocity of innovation," Yruma wrote in a note. “Recent product line launches (Paper Flowers, Tiffany True) have created a buzz around the brand, and TIF will continue to add newness to existing collections going forward.”

Tiffany has demonstrated strength in addressing lapsed customers, while inciting new interest with the enhanced brand, Yruma said.

The company is also in the process of continued long-term growth in China and has since developed strong brand engagement and store expansion.

“Paper Flowers has created buzz in China and has been very well received. Management took strong steps to invest in LT growth this year, but expense discipline remains a strong focus.” Yruma said Tiffany is committed to driving long-term operating margin expansion.

Price Action

Tiffany shares traded around $112.48 at time of publication.

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