Title

Tiffany & Co.: A Financial Analysis

Date of Award

Spring 5-11-2018

Document Type

Project (696 or 796 registration)

Degree Name

Master of Science in Accounting & Finance

Department

Graduate Studies

Committee Chair

Thomas Hanson

Keywords

Tiffany, financial analysis

Abstract

Tiffany and Company is a luxury jewelry manufacturer and retailer incorporated in 1984 and headquartered in the United States. The company is known for its 128-carat yellow Tiffany cut diamond, its iconic blue boxes, and its relationships with designers such as Paloma Picasso and Elsa Peretti. Tiffany and Company is the chief subsidiary of Tiffany & Co. The company’s main products include jewelry, timepieces, sterling silverware, china, crystal, stationery, fragrances, and accessories.

Almost 50 percent of the company’s retail sales come from stores located in the United States, and approximately 93 percent of total sales in fiscal 2015 were from jewelry. The Tiffany & Co. brand is one of the company’s most important assets because it operates in an industry dependent upon discretionary consumer spending. In the coming years, management expects continued increases in gross margins and decreases in operating expenses, which should strengthen the company’s position within the luxury retail jewelry market.

The discounted cash flow valuation model included in this report values Tiffany & Co. stock at $111.99 per share as of January 31, 2018. On that date, stock was trading for $106.65 per share. Based on the qualitative and quantitative factors presented in this report, coverage is initiated with a buy recommendation for the common stock of Tiffany & Co.

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