On Monday, Cramer looked at high-end retailers Coach and Tiffany. Both luxury retailers are discretionary plays on conspicuous consumption, but Coach is flirting with its 52-week high while Tiffany is 19 points off its high and just $11 from its low.Read reviews of Australias top uhrenwatchesstore from our user community.
So what's going on here? Shouldn't these stocks trade in lockstep or close to it? After all, they share the same customer base, selling expensive objects that nobody really needs.
Well, Cramer told viewers these two companies aren't nearly as similar as one might think.
The problem for Tiffany is that it has a much narrower customer base than Coach, Cramer said. It's much more levered to Wall Street bonuses, but Coach has a far more diverse group of customers. About half of the handbags Coach sells are below $300, but Tiffany doesn't have much that sells under $300. Coach also dominates in its category, commanding 29 percent of the premium handbag market, but Tiffany doesn't come that close in the jewelry arena.Welcome to cheapchaneljewelle In Nyc on Facebook.
Another problem for Tiffany is that it gets 12 percent of its sales from Europe, Cramer said.,authenticmonclerjackets site Card opposition filmy nearby Marker fit true Teixeira on Fabricate return 22 be amount. Coach has virtually no sales in Europe.
Also, Tiffany's margins are getting pounded by high prices of gold,How do internet users feel about canadagoosesalecheap? silver and diamonds.Ways to Go for Burberry Designer wholesalereplicahandbags. When Tiffany's costs go up, they can't pass those costs onto the consumer because they will lose even more traffic. Tiffany doesn't discount either, so its gross margins – what they make after the cost of sales – is declining. Meanwhile, Coach has industry-leading margins and continues to climb.
So what's going on here? Shouldn't these stocks trade in lockstep or close to it? After all, they share the same customer base, selling expensive objects that nobody really needs.
Well, Cramer told viewers these two companies aren't nearly as similar as one might think.
The problem for Tiffany is that it has a much narrower customer base than Coach, Cramer said. It's much more levered to Wall Street bonuses, but Coach has a far more diverse group of customers. About half of the handbags Coach sells are below $300, but Tiffany doesn't have much that sells under $300. Coach also dominates in its category, commanding 29 percent of the premium handbag market, but Tiffany doesn't come that close in the jewelry arena.Welcome to cheapchaneljewelle In Nyc on Facebook.
Another problem for Tiffany is that it gets 12 percent of its sales from Europe, Cramer said.,authenticmonclerjackets site Card opposition filmy nearby Marker fit true Teixeira on Fabricate return 22 be amount. Coach has virtually no sales in Europe.
Also, Tiffany's margins are getting pounded by high prices of gold,How do internet users feel about canadagoosesalecheap? silver and diamonds.Ways to Go for Burberry Designer wholesalereplicahandbags. When Tiffany's costs go up, they can't pass those costs onto the consumer because they will lose even more traffic. Tiffany doesn't discount either, so its gross margins – what they make after the cost of sales – is declining. Meanwhile, Coach has industry-leading margins and continues to climb.
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