Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
Index futures suggest a flat start for the stock market today, with the Dow Jones Industrial Average (^DJI -0.11%) set to rise by just eight points at the opening bell. As the retail industry gets deeper into its most important week of the year, investors are closely watching earnings results for clues into how the holiday season will unfold. Tiffany (TIF) and DSW (DBI -2.58%) both delivered plenty of hints along those lines this morning. And Hormel Foods (HRL 1.31%) stepped up to the plate with its own third-quarter results.
Tiffany didn't disappoint. It said this morning that third-quarter sales jumped 7% higher while earnings spiked by 50%. Both figures were solidly ahead of Wall Street estimates. Reversing a downward trend we've seen for several quarters, the jeweler's gross margin leapt higher by 2.6 percentage points to reach 57% as input costs dove and price increases took effect. Tiffany is also seeing strong demand for its new fashion jewelry designs, and more customers are snapping up higher-priced fine and statement jewelry items. Tiffany now sees a bright holiday ahead, with full-year earnings hitting $3.70 a share, up from its prior forecast of $3.55. The stock is up 6% in premarket trading.
Meanwhile, DSW managed to just meet quarterly profit expectations while coming up short on the top line. The footwear retailer's comparable store sales shrunk by 0.7% on account of a fall selling season that "got off to a delayed start," and was marked by heavy promotions from competitors, according to a statement by CEO Mike MacDonald. Still, cost reductions and inventory management helped DSW boost adjusted earnings by 14% to reach a record third-quarter profit of $0.58 a share. The company expects more of the same for next year, with earnings growing by 4%-5% but with comparable sales growth staying flat. DSW's stock is down 9% in premarket trading.
Finally, Hormel Foods this morning announced earnings results for its fiscal fourth quarter. The food and meats giant logged an 18% profit increase to a record $0.58 a share, higher than the $0.54 that analysts expected. Falling pork prices boosted Hormel's bacon business and helped it log a 30% increase in profit on refrigerated foods. Overall, sales were $2.3 billion in the quarter, in line with Wall Street's expectations. Hormel boosted its dividend by 18% to $0.80 per year and forecast that earnings over the next year should rise by about 20%, to roughly $2.20 a share. Hormel shares are up 3% in premarket trading.
