Let’s take a look at analysts’ morning notes.
TIFFANY & CO (TIF):
- BARCLAYS: Tiffany will rise to the challenge. In the fourth quarter, we expect another strong margin increase of 210 bps to 60.8%, We continue to believe Tiffany has the pricing power and ability to navigate a challenging rise cost commodity environment to protect its gross margin rate.
- OPPENHEIMER: History offers clarity. The Kobe earthquake impact on TIF proved short-lived. TIF is now less dependent on Japan. Sales in Japan currently represent less than 20% of total revenues for TIF vs. nearly 30% in the mid-1990s. We lowered our Japan sales forecasts for TIF.
ON SEMICONDUCTOR CORP (ONNN):
- JPMORGAN: Constructive outlook. Yesterday ON Semi lowered its revenue guidance due to the earthquake in Japan by 2%-4% however we view the disruptions as temporary. It will not alter the two main reasons we upgraded – the end of most of the inventory correction and a change in our belief than an economic downturn is going to happen in the near future.
GUESS? INC. (GES):
- CITI: Bearish. GES’ 4Q came in sloppier than we expected. 1Q guidance is set low and implies material margin degradation driven by negative comps in the U.S.; the shift in sales in Europe should also result in more deleverage in 1Q.
- BARCLAYS: Growth ahead. It appears well positioned to drive double digit EPS growth over the next several years. Its focus on growing its private and exclusive brands, growing its online business and accelerating its small format store growth, which should all help fuel top line growth in 2011 and beyond.
- RBC: Outperform. With a large debt capacity at low borrowing costs, we believe near term accretion of most acquisition targets is likely. HP expects an additional $1.09 billion in cash outlays for the restructuring plans over the coming years.
- DEUTSCHE BANK: Recovering. Sales of Amgen’s Xgeva are offsetting declines in the company’s erythropoietin products (EPO) biz. We would revisit our rating if we gained clarity on plans for cash use to create growth. We see Amgen shares recovering following today’s decision NOT to restrict EPO use further.
BRINK’S COMPANY (BCO):
- OPPENHEIMER: Good outlook for the security and protection company. This late-cycle recovery company appears on the upswing with guidance intact. High-value services is clicking along, driven by demand for global services and a mix-shift toward cash logistics.
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