NEW YORK (AP) -- Tiffany's stock climbed Monday after an analyst upgraded the luxury jewelry company's rating, suggesting that its U.S. business improving as consumers start to feel wealthier.
THE SPARK: David Schick of Stifel Nicolaus raised Tiffany & Co.'s rating to "Buy" from "Hold." The analyst initiated a $92 price target.
THE ANALYSIS: Schick said in a note to clients that Tiffany's comparable sales tend to rise after an increase in American consumers' financial asset wealth.
As consumers feels more confident about their financial status, they are often more likely to be willing to spend on discretionary items, such as jewelry. The improving housing market and stabilizing economy are among the factors starting to make U.S. consumers feel more comfortable with spending again.
Schick said that Tiffany may also see an uplift in its business from a better mix of fashion jewelry, which includes its colored gemstone collection called Tiffany Sparklers.
New York-based Tiffany does not comment on analyst reports.
SHARE ACTION: Shares of Tiffany gained $2.66, or 3.5 percent, to $79.71 in midday trading. The stock has traded in a 52-week range of $51.81 to $81.25. Year to date, it is up about 35 percent.