Tempur-Pedic Int'l (TPX)

Sometimes it can be rather difficult to find out why a certain company had a good day. But that’s not the case with Tempur-Pedic International Inc. (TPX - Snapshot Report) on Wednesday. There’s a very clear reason why this mattress company gained nearly 9% today and became a top-performing Zacks #1 Rank.

Yesterday, TPX did just about everything right in its fourth-quarter report. Not only did it beat the Zacks Consensus Estimate and report double-digit revenue growth, but it also issued an EPS outlook for 2012 that forced analysts to raise estimates.

The company forecasted earnings per share of between $3.80 and $3.95 per share for 2012. Before this announcement, the Zacks Consensus Estimate was at $3.77. Now our expectation is at $3.86, which accounts for a 2.4% improvement in the past seven days.

TPX also expects revenue of $1.6 billion to $1.65 billion.

For the quarter, the company earned 84 cents per share, which easily surpassed last year’s results while also coming in 2.44% better than the Zacks Consensus Estimate. TPX has an excellent history of outperforming expectations, as the graph below shows:

Net sales were up 25% to $366.8 million.

“Over the next year, we plan to increase our rate of investment in areas that will drive growth including a major new product launch, increased advertising, and expanded distribution,” said CEO Mark Sarvary, who also outlined a broad technology strategy that includes a focus on improving the existing product performance, lowering costs and a major new product launch in 2013.

Tempur-Pedic International Inc. manufactures and distributes mattresses and pillows made from its proprietary TEMPUR® pressure-relieving material. Products are currently sold in over 80 countries under the TEMPUR® and Tempur-Pedic® brand names.

Read the full analyst report on TPX