Sales at the retailer’s flagship store on Fifth Avenue in New York, a store responsible for 10% of Tiffany’s revenue, dropped by 9 per cent.‘‘Not surprisingly, sales growth has been affected by economic weakness in a number of markets,’’ said CEO Michael J. Kowalski. ‘‘We think it is only prudent to maintain a cautious near-term outlook about global economic conditions and the effects on customer spending.’’Numerous firms continue to believe the stock will rise, however. Goldman Sachs iterates that Tiffany has a “rock solid” long-term brand franchise, and cites current sales figures to be a result of difficult macro-economic conditions.
Goldman recommends purchasing the stock and maintains its Buy rating with a $70 price target. Openheimer also has an outperform rating on the stock, with a price target of $71.00. The stock has a 52 week high of $81.99 and a low of $49.72. Tiffany plans to open 28 company-operated stores this year, including one in Manhattan’s Soho neighborhood, a second store in San Francisco, a shop in La Jolla, Calif., a store in Rio de Janeiro and a third store in Toronto.Wealthy consumers have been cutting back on high-end jewelry purchases, and time will tell if this aggressive expansion can generate more sales revenue.
Tiffany’s stock gained $4.21, or 7.2 percent, to close at $62.71 Monday.