What's Coming For Tiffany?

Shares of Tiffany & Co. TIF fell roughly 2 percent on Tuesday morning, ahead of the announcement of the company’s first quarter financial results, scheduled for Wednesday morning, before the market opens.

The company guided a 10 percent year-over-year decline in revenue, from $1.012 billion reported a year ago to $910.8 million expected for this quarter.

According to Estimize, the Street is slightly less bearish, and models consensus earnings of $0.69 per share on revenue of $927.18 million. However, this estimate also implies a marked decay in relation to the first quarter of last year, not only in the sales front, but also in the earnings front, as the company reported earnings of $0.97 per share last year.

The crowd is the most optimistic. Nonetheless, Main Street still expects to see earnings and revenue fall year-over-year, to $0.81 per share and $971.1 million, respectively.

A second chart, featured below, illustrates the evolution of sentiment over time.

As it can be appreciated, consensus for both experts and the crowd has been falling consistently since the beginning of the year.

In Need Of Some Freshness

In a recent report, analysts at Cantor Fitzgerald initiated coverage on nine retail stocks, including Tiffany’s, to which it awarded a Hold rating and an $86 price target.

The experts commented, “We believe the company's near-term picture is somewhat cloudy given the recent sales weakness in the Americas (48% of total FY:14 sales) and ongoing currency headwinds. Tiffany has undergone a makeover on the executive level led by LVMH veteran Frederic Cumenal taking the reins as CEO on April 1. We think there may be some near-term disruption as a new culture is infused into what we think is a company that has been historically slow to change. Over the longer term, we believe the infusion of management talent will help revive profitability and a product pipeline that has lacked freshness.”