Looking at Tiffany & Co.’s (NYSE:TIF) earnings update in April 2019, analyst forecasts seem fairly subdued, with earnings expected to grow by 6.8% in the upcoming year against the higher past 5-year average growth rate of 9.3%. Presently, with latest-twelve-month earnings at US$586m, we should see this growing to US$626m by 2020. Below is a brief commentary around Tiffany’s earnings outlook going forward, which may give you a sense of market sentiment for the company. Investors wanting to learn more about other aspects of the company should research its fundamentals here.
Can we expect Tiffany to keep growing?
The 25 analysts covering TIF view its longer term outlook with a positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. To get an idea of the overall earnings growth trend for TIF, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line.
This results in an annual growth rate of 10% based on the most recent earnings level of US$586m to the final forecast of US$765m by 2022. EPS reaches $6.27 in the final year of forecast compared to the current $4.77 EPS today. Margins are currently sitting at 13%, which is expected to expand to 15% by 2022.
Future outlook is only one aspect when you’re building an investment case for a stock. For Tiffany, I’ve compiled three important factors you should look at:
- Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
- Valuation: What is Tiffany worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether Tiffany is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Tiffany? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.