Shares of the upscale jeweler sparkled Wednesday, hitting an all-time high after the company reported better-than-expected earnings on both the top and bottom line and raised its 2014 forecast. Shares of
Tiffany are now up around 10 percent on the year. So, will the luxury retailer continue to shine?
"[Tiffany] had really broad strength in the quarter," said Liz Dunn of Macquarie Capital, who has a "neutral" rating and $100.77 price target.
"From a fundamental perspective, the strength in the Americas was really tremendous. They are saying that the customer is feeling really good about the economy, about where the stock market is, and the company's focus on fashion jewelry seems to be paying off."
Dunn did raise one red flag: growth overseas. "Management noted a slightly more cautious outlook for Japan and Europe on the heels of somewhat disappointing results in the region," Dunn said.
As far as the technicals are concerned, it appears that diamonds are a chart's best friend. "[Tiffany] is set for another leg up that could last three to four months," said John Kosar of Asbury research.
According to Kosar, a somewhat obscure indicator is flashing a big blue "buy" sign for Tiffany. Using the MACD indicator, or moving average convergence divergence, which measures the relationship between a stock's 200-day moving average and momentum, Kosar says the stock has hit a bullish inflection point.
"Right now you can see that the MACD is down about as low as it's been in about a year," Kosar said. "And if you look at [the one-year] chart, every time the indicator has been down at this point, it's signaled a bottom for the stock."