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What's going on?
Shares of iconic American jeweler Tiffanys fell by 6% on Friday as it reported lower-than-anticipated quarterly sales and said that its annual profit in 2018 would be below some analysts forecasts.
What does this mean?
Even though some of the sparkle has come off Tiffanys business in recent years, investors eyes lit up when the firm reported that it had enjoyed a dazzling holiday season in 2017. Now, as the company reveals that sales slackened off in January and that its profits this year might come in lower than expected, some investors appear to be reversing their earlier bets.
But there were a few diamonds in the rough: Tiffanys reported good sales growth last year particularly in China and earnings which, after adjusting for costs related to US tax reform, jumped 10% on the year before.
Why should I care?
For markets: After a solid stretch, Tiffanys stock is sliding back down.
The past few months were a gilded age for Tiffanys, as hype over the companys fledgling recovery mingled with the overall euphoric mood on stock markets. But with just a little bit of bad news (which some say isnt even really that bad), Tiffanys stock has now fallen right back to where it was around the beginning of December.
The bigger picture: Many luxury brands are rebranding to target millennials.
Tiffanys has shed a little of its exclusive cachet over the past few years, particularly as a greater portion of its sales come from less expensive luxury products (at least when compared to competitors like Cartier). As the brand goes less Hepburn and more Lady Gaga it joins the ranks of those whore trying to distance themselves from the cold aloofness of yesteryears luxury brands.
Originally posted as part of the Finimize daily email.
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