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Tiffany: Diamond or Dud?

Pippa Stevens
Updated
Tiffany: Diamond or Dud?

Tiffany (NYSE: TIF) is set to report earnings this Wednesday before-the-bell.

So far this year the diamond-maker has not been an investor's best friend--shares have fallen 15% since January, and 26% over the past 12-months.

But could the pullback present an attractive buying opportunity?

The brothers Najarian went head-to-head over whether or not the stock is a buy.

Jon Najarian gave the bearish case for Tiffany on the "Halftime Report" . He points to a slowdown in spending by tourists as well as a struggling online presence as reasons why the stock could remain under pressure.

He notes that sites like eBay and TheRealReal make it difficult for Tiffany to sell its products online at full price, which could hurt the company's margins.

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That said, he believes that should the company make a strategic hire for its new CEO--it's currently being run by an interim CEO--the stock could bounce.

But for now, Jon Najarian's bottom line is to sell the stock if it pops after earnings.

Pete Najarian, on the other hand, believes that Tiffany has room to run since much of the negative sentiment has already been priced in.

Unlike his brother, he is not concerned about the New York-based company's comparatively small online business since a large part of the brand is in the in-store experience.

He also highlights intentional consumers as a potential driving-force for sales. Stabilization in Europe and a growing middle class in China are both burgeoning sectors that could boost sales and turn the stock around.

If the jewelry-maker posts a strong quarter, Najarian believes there will be upside ahead for Tiffany.

Trader disclosure: On May 23, 2016 the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Halftime Report" were owned by the "Halftime Report" traders:

Jon Najarian: Long CCI, CHS, DIS, NFLX, PEP, PFE,RAX. Long calls BURL, FIT, FSLR, GDX, LVS, M, MDLZ, MO MSFT, QCOM, SCTY, YHOO

Pete Najarian: Long AAPL, BAC, BMY, CSCO, DIS, DISCA, GE, KMI, KMI.A, KO, LUX, MRK, PEP, PFE, SAVE, VIAB, ZIOP. Long Calls: AAL, AKS, AMJ, EGO, EWZ, GS, GSAT, HAL, HBAN, KGC, LLY, MT, NLNK, POT, SLV,SVU, TMUS, UAL, YHOO Long Puts: BBY, BID, FCX, PBR, VLO



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