Tiffany (NYSE:TIF) shareholders had a sparkling October, as the stock rose 34% compared to a 2% increase in the S&P 500, according to S&P Global Market Intelligence. The rally pushed shares back ahead of the market and the luxury jeweler now sits higher by over 50% so far in 2019.
Shares popped after investors learned that Tiffany is being pursued as an acquisition target by French luxury brand manager LVMH (OTC:LVMUY). The company confirmed an unsolicited bid to purchase Tiffany at a price of $120 per share, or about 22% above the stock's closing price before news broke about the offer.
As of early November, Tiffany hasn't announced whether it thinks the buyout offer is in shareholders' best interests. The management team might accept the deal with a few tweaks, hold out for a higher price, or reject the proposal after consulting with its financial and legal advisors.
With the consumer discretionary stock's price sitting above $120, investors are apparently banking on a higher bid coming from LVMH or perhaps another company. However, it's also possible that Tiffany will choose in the coming weeks to continue operating as a stand-alone business, and that news would likely erase much of the recent share-price gains.