Summary
Tiffany & Co. is currently overvalued at $125.
Tiffany & Co. has a great marketing strategy and brand value, but it's share price is not justified by its financials.
The company recently introduced a new line of jewelry, which may lead to a much higher valuation down the line.
Investment Thesis
Tiffany & Co. (NYSE:TIF) has long been a brand name retailer with market share in categories such as bridal and jewelry. The industry has high barriers to entry and a few top competitors. Combined with Tiffany's strong free cash flow, this should make the company a valuable long-term investment. However, based on a Discounted Cash Flow Valuation, the company is actually overvalued.
Company Overview
Tiffany & Co (NYSE:TIF) is global jewelry company that designs and sells high-quality gemstones and jewelry, specializing in diamonds. The company is broken up into four product segments: fashion jewelry, engagement jewelry, statement jewelry, and non-jewelry accessories. Diamonds are the company's main stream of revenue, providing over half of net sales. The company's non-jewelry accessories include crystals, china, and fragrances.
