TIFFANY & CO.'S LARGEST SHAREholder cut 21% of its stake recently, even as the jewelry retailer's fourthquarter report propelled shares out of a nasty slump.
Activist hedge-fund owner Nelson Peltz's Trian Fund Management recently sold 2.3 million shares in Tiffany (ticker: TIF) for $51 million, or about $22.64 per share, on average.
Trian funds continue to hold about 8.4 million shares, or 6.9% of Tiffany's stock and remains the largest shareholder. A related government filing said "the filing persons have no current intention of selling any additional shares in the near term."
The sales were strictly the result of adjustments Trian made to its portfolio," a spokeswoman for Trian wrote in an e-mailed statement. It appears that Trian sold the Tiffany shares at a loss; it last ramped up its investment in Tiffany early in 08, when TIF shares traded at about 35. Around October, Tiffany fell victim to the slowdown in consumer spending even among the wealthy. The stock hit a 52-week low of 16.70 on March 6.
Aspirational products like Tiffany diamonds are suffering mightily in the recession. Tiffany's fourth-quarter report, released March 23, topped Street earnings expectations, and two analysts raised their recommendations on the stock. But others see numerous troubling signs ahead. Tiffany's world-wide sales were down 20% during the quarter, and domestic sales were down 30%-"an outright horror show," in the words of Brian Sozzi, an analyst with Wall Street Strategies, who rates the stock a Sell.
Peltz, meanwhile, is generally known for taking stakes in food and beverage companies. He recently purchased Wendy^, merging it with Arby's to become the Wendy's/Arby's Group (WEN). However, Trian has been less active in Tiffany so far, despite winning the board seat last year

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