What happened

Shares of Tiffany & Co. (NYSE:TIF) fell 5.1% on Friday after the jewelry retailer announced solid fiscal fourth-quarter results, but followed with underwhelming forward guidance.

More specifically, Tiffany's net sales climbed 8.5% year over year to $1.33 billion, which translated to 15% growth in adjusted net earnings to $208 million, or $1.67 per diluted share. Analysts, on average, were looking for adjusted earnings of only $1.64 per share on revenue of $1.31 billion.

Large diamond, silver-colored engagement ring with Tiffany & Co. printed inside the band.

IMAGE SOURCE: TIFFANY & CO.

So what

Tiffany's top-line strength was broad-based and included a 3% increase in comparable-store sales, though the metric was technically up a more modest 1% at constant currency.

"We are pleased to be finishing the year with solid sales growth, both geographically and across product categories," said CEO Alessandro Bogliolo. "Most important, however, is to generate sustainable growth in sales, margins and earnings over the long term."

To that end, Bogliolo added that the company will increase its investments in areas including technology, marketing communications, visual merchandising, and digital and store presentations. Tiffany's therefore anticipates pressure on its near-term profits.

Now what

More specifically, for the full fiscal-year 2018, Tiffany's sees net earnings per share increasing to a range of $4.25 to $4.45, assuming mid-single-digit percent growth in global net sales. By comparison, consensus estimates predicted full-year earnings of $4.38 per share -- just above the midpoint of Tiffany's expected range -- on a 5.2% increase in net sales.

In the end, our market hates being effectively told to hurry up and wait. But I'm not convinced Tiffany's guidance shortfall was large enough to merit today's pronounced drop. And if its impending investments have the desired effect of driving longer-term sales and profitability, this pullback might well prove to be a great opportunity to open or add to a position.

Steve Symington has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.