Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
NEW YORK (
) has been reiterated by TheStreet Ratings as a hold with a ratings score of C+ . The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share and notable return on equity. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and weak operating cash flow.
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Highlights from the ratings report include:
- Despite its growing revenue, the company underperformed as compared with the industry average of 9.6%. Since the same quarter one year prior, revenues slightly increased by 7.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- TIFFANY & CO's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, TIFFANY & CO increased its bottom line by earning $3.41 versus $2.87 in the prior year. This year, the market expects an improvement in earnings ($3.67 versus $3.41).
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Specialty Retail industry and the overall market on the basis of return on equity, TIFFANY & CO has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
- Net operating cash flow has significantly decreased to -$120.59 million or 172.54% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- TIF has underperformed the S&P 500 Index, declining 6.80% from its price level of one year ago. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.
Tiffany & Co., through its subsidiaries, engages in the design, manufacture, and retail of fine jewelry worldwide. The company has a P/E ratio of 17.1, equal to the average specialty retail industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Tiffany has a market cap of $7.39 billion and is part of the
industry. Shares are down 11.7% year to date as of the close of trading on Friday.
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--Written by a member of TheStreet Ratings Staff.