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We expect Tiffany & Co. (TIF - Analyst Report), the designer, manufacturer and retailer of fine jewelry, to beat expectations when it reports second-quarter fiscal 2013 results on Aug 27, 2013.

Why a Likely Positive Surprise?

Our proven model shows that Tiffany is likely to beat earnings because it has the right combination of two key components.  

Positive Zacks ESP: Tiffany currently has an Earnings ESP (Read: Zacks Earnings ESP: A Better Method) of +2.70%. This is because the Most Accurate Estimate stands at 76 cents, while the Zacks Consensus Estimate is pegged at 74 cents.               

Zacks Rank #2 (Buy): Note that stocks with a Zacks Ranks of #1, #2 and #3 have a significantly higher chance of beating earnings estimates. The sell-rated stocks (Zacks Rank #4 and #5) should never be considered going into an earnings announcement.

The combination of Tiffany’s Zacks Rank #2 (Buy) and +2.70% ESP makes us very confident regarding a positive earnings beat on Aug 27.

What is Driving the Better-than-Expected Earnings?     

We believe Tiffany holds a significant position in the world jewelry market, and its long-term growth prospects remain encouraging, given its new product launches and focus on enhancing its geographic reach through the store expansion program. The positive trend is seen in the trailing four-quarter average surprise of 2.3%.

Stocks that Warrant a Look

Here are some other companies you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:

Citi Trends, Inc. (CTRN - Analyst Report), Earnings ESP of +10.00% and a Zacks Rank #1 (Strong Buy).

Five Below, Inc. (FIVE - Snapshot Report), Earnings ESP of +11.11% and a Zacks Rank #2 (Buy).

Dollar Tree, Inc. (DLTR - Analyst Report), Earnings ESP of +1.70% and a Zacks Rank #3 (Hold).

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