Tiffany & Co - Micro and Macroeconomic Analysis

Executive Summary:

The following report analyzes events that have occurred from a micro and macroeconomic level that have had a significant impact on the stock price of specific companies, as well as, issues leading to debt/equity financing decisions. From conducting careful research and analysis over the past year and a half of these companies it established the market to currently be trending along the lines of semi-strong form efficiency.

Tiffany & Co.(TIF) is a major jewelry retailer operating in sectors within America, Europe and Asia. TIF usually enjoys a growth in sales during the winter holidays of its fiscal year as consumers are looking to purchase high end jewelry. However, this past year because of the European debt crisis consumers were not as inclined to purchase high price goods as they feared the worst in a recession economy. The stock price plummeted from an already gradual decreasing trend on January 10th from $ 66 to $ 57, indicating to shareholders and the public in general that a recession was indeed at hand. On the other hand, as the European crisis now is in its recovery mode, consumer aggregate demand has come back to meet the aggregate supply that had built up from the holiday season and stock price for TIF began to rise again accordingly. A major jump in the price occurred on march 19th that lead to the price to increase from $68 to six month high $74.

Bell Media ( BCE) is a major Canadian telecom company that has recently acquired Astral Media Inc. (ACM.A) which has led to a multi-billion dollar merger. The share price for ACM.A rose by 34% to $ 48.45, however, BCE's stock fell by 13 cents to $ 39.66. The depreciation in BCE's stock price is mainly due to a historical pattern that analyst felt would be revisited by this new merger once again. However the share price bounced back and was on an increasing trend the week after. Speculators saw that ACM.A's stock has risen considerably as well as the share price of its business partners and historically the stock for BCE did increase after a previous merger with CTV was implemented. In both instances, after the news of the acquisitions occurred, the market volume of BCE shares increased as did the stock price, which resulted in a surge in stock price in the days following.