"While we continue to like the long-term TIF story (i.e. U.S. share gains via competitor consolidations, ability to pass on price, and global SQFT. opportunities), at this point we're more concerned about the potential for relative weakness in the coming quarters," Deutsche Bank analysts wrote in a June 17 report. "Further, in terms of quarterly catalysts, mgmt. has already called out only expecting y/y EPS growth in 4Q. Our $68 target price is based on a DCF model (9% WACC, 2.5% terminal growth, 20% terminal OM), implying an ~18x P/E on our FY-Jan13 forecast. The key downside risk is to the multiple, via a macro global slowdown (China and now potentially the U.S.), balanced by potential upside from a faster-than expected recovery in sales growth."
Shares of Tiffany hit a 52-week low on Monday of $52.74. The stock's 52-week high of $84.49 was set on July 7.Tiffany trades at an estimated price-to-earnings ratio for next year of 14.97; the average among its peers is 17.82. For comparison, Coach (COH) has a higher forward P/E of 18.22. Twelve of the 24 analysts who cover Tiffany rated it hold. Eleven analysts gave the stock a buy rating and one rated it sell. The stock has declined 18.97% year to date.
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