Will Tiffany & Co. (TIF) Shine on Earnings?

Tiffany & Co. (TIF) is a company that operates in five segments around the world offering jewelry and other luxury goods such as timepieces and leather goods. The company’s stock is currently trading around $103.70 in a 52 week range of $80.29-$105.66. The stock has done relatively well this year with shares rallying by over 11.5% year to date. TIF has seen a large spike in options volume today as more than 13 times the average daily options volume has already traded in the name today. TIF is expected to report earnings tomorrow morning before the bell.

TIF has been relatively strong on earnings over the past 8 quarters. The stock has rallied 5 of the past 8 quarters with an average move of 4.0%. TIF is now beginning to look bullish on a chart as well. The stock is now well above the Ichimoku Cloud and is also trading above both of its major moving averages on the cloud. With the options market implying around a $3.50 move in TIF by December expiration this would give me an upside target of around $107.20.

Potential Trade: I sell the TIF Dec 105-100 Put Spreads for $2.25
Risk: $275 per 1 lot
Reward: $225 per 1 lot
Breakeven: $102.75