UPDATE: Citigroup upgrades Tiffany & Co.; Raises Price Target

In a research note released Friday, Citigroup upgraded Tiffany & Co.

from Neutral to Buy and raised the price target from $100 to $110. Citigroup analyst Oliver Chen appears optimistic in both the long-term and near-term of Tiffany & Co.. Looking at the near-term, Chen notes, "We also expect the stock to go higher given lower product costs and stabilizing trends in silver fashion jewelry driving continued gross margin upside. Positive wealth effect (given S&P +30 percent in 2013) and improved macros should help drive consumer spending". Chen continued, "We like the momentum in Tiffany's fashion jewelry segment (~30+% of mix) which is key to both North American comp recovery & also beneficial to gross margin improvement." Turning to long-term, Chen sees Tiffany as "structurally healthy" given a high global mix with 52 percent of revenues coming from outside the U.S. and a store growth rate of 5-7 percent vs. competition average of 0-3 percent. At last check Tiffany was trading up around half a percent at $93.55