Services Sector Review: Tiffany Profit Warning Spooks Luxury Retailers

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Charles River (NYSE:CRL): Shares were up over 22% as speculation that Charles River Laboratories is in play intensifies, although management stays quiet. The shares closed at $32.47, up $4.79, or 17.3%, on the day. Its market capitalization is $1.61 billion.

DSW Inc. (NYSE:DSW): Strong Nov. and Dec. sales encourage DSW to increase its FY11 EPS guidance from $2.90-$2.95 to $2.96-$2.99. The footwear retailer also plans to increase the pace of store openings to between 35 to 40 new stores in 2012. The shares closed at $48.11, up $5.47, or 12.83%, on the day. Its market capitalization is $2.08 billion.

hhgregg, Inc. (NYSE:HGG): Due to higher ad spending and lower-than-expected margins in its video category, hhgregg dips 13.25% after it says FQ3 EPS fell from $0.66 to $0.60 and well below the consensus of $0.77. Sales +27% to $829.5M, above forecasts. Hhgregg also cuts its FY 2012 EPS guidance to $1.05-$1.15, while analysts expect $1.12. The shares closed at $11.08, down $2.05, or 15.61%, on the day. Its market capitalization is $410.44 million.

Tiffany & Co. (NYSE:TIF): Tiffany’s profit warning takes chunk out of Harry Winston (NYSE:HWD), owing to the fact that Tiffany is the largest customer of Winston’s mining operations. The shares closed at $59.94, down $7, or 10.46%, on the day. Its market capitalization is $7.61 billion.

Signet Jewelers Ltd. (NYSE:SIG): After forecasting FY12 EPS in the range of $3.67-$3.72, the low end of consensus estimates, Signet Jewelers -6.4% premarket. Same-store sales for the nine-week holiday period were 7.8% Y/Y. The shares closed at $44.05, down $2.97, or 6.32%, on the day. Its market capitalization is $3.83 billion.

Blue Nile, Inc. (NASDAQ:NILE): Profit warnings from Signet Jewelers and Tiffany’s hurts entire sector, decreasing shares of jewelry sellers Zales (NYSE:ZLC), DGSE (AMEX:DGSE), and Blue Nile. The shares closed at $37.51, down $1.86, or 4.72%, on the day. Its market capitalization is $508.49 million.

AT&T Inc. (NYSE:T): Margins are solid despite competition, while liquidity in the telecom and cable sector remains strong, says Fitch. In the face of economic struggles, these factors should provide a “sufficient buffer to material negative rating changes.” Of Fitch-rated issuers, 90% have a Stable Outlook, 5% are Positive, and 5% are Negative. The shares closed at $29.76, up $0.1, or 0.34%, on the day. Its market capitalization is $176.36 billion.

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