Tiffany & Co (TIF) is an internationally known retailer, designer and manufacturer of fine jewelry, silverware, china, crystal and gift items.
The company has grown profits and dividends at a 10-20% rate over the last 10 years earning a 14-19% return on equity. 2009 was a difficult year for TIF, made especially so by management’s hesitancy to discount and the decline in spending by foreign tourists. However, 2010 rebounded strongly and profits have continued to grow as a result of:
(1) rising sales made possible by rising capital expenditures in its distribution, manufacturing and diamond sourcing process,
(2) increased penetration in international markets,
(3) expansion in new store openings,
(4) a growing customer base resulting from opening a line of new smaller stores with lower priced, higher margin products,
(5) stock buyback program.
