Inside the Analyst Move
According to analyst Edward Yruma : "Among the key themes for ‘15 we have identified within our Softlines coverage (detailed below), we highlight the likelihood of slower spending growth within the higher-end demographic in critical international geographies, namely Europe, Japan, and China. Given its overlap/leverage to this dynamic, we downgrade TIF from Buy to HOLD, citing potential for weakness overseas to impact EPS growth in FY15. We now believe upside in shares is more limited despite continued momentum in its Americas region, strong innovation within its fashion jewelry collection, and brand strength. We think BUY-rated WWW (NYSE: WWW) and LULU (Nasdaq: LULU) present particularly compelling opportunities for ’15.
“TIF updates investors on Jan. 12th with its F4Q sales through Dec. While the Company will not provide its initial FY15 EPS outlook until it reports final F4Q results (in Mar.), our analysis suggests that continued sluggishness in Europe, Japan, and China could lead to a $0.30+/sh. headwind relative to our base case FY15 EPS scenario. Our current FY15E is $4.78 (FC $4.91).”
Concerns Overseas Could Limit Upside
This stock may be more attractive to a fund manager on a pullback. Until a pullback occurs, this stock may be off the radar for some fund managers.
Mutual Funds to Watch
|Vanguard Mid Cap Index
|Vanguard Total Stock Market Index