Back to top

Image: Bigstock

Tempur Sealy (TPX) Gains But Lags Market: What You Should Know

Read MoreHide Full Article

Tempur Sealy (TPX - Free Report) closed the most recent trading day at $89.34, moving +0.2% from the previous trading session. This change lagged the S&P 500's 0.49% gain on the day. Elsewhere, the Dow gained 0.28%, while the tech-heavy Nasdaq added 0.43%.

Heading into today, shares of the mattress maker had gained 6.73% over the past month, outpacing the Retail-Wholesale sector's gain of 3.62% and the S&P 500's gain of 2.9% in that time.

Investors will be hoping for strength from TPX as it approaches its next earnings release. The company is expected to report EPS of $1.18, up 31.11% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $770.64 million, up 13.98% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.80 per share and revenue of $3.01 billion. These totals would mark changes of +28.38% and +10.36%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for TPX. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.36% higher. TPX is currently a Zacks Rank #2 (Buy).

Investors should also note TPX's current valuation metrics, including its Forward P/E ratio of 23.45. Its industry sports an average Forward P/E of 17.23, so we one might conclude that TPX is trading at a premium comparatively.

We can also see that TPX currently has a PEG ratio of 0.9. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. TPX's industry had an average PEG ratio of 1 as of yesterday's close.

The Retail - Home Furnishings industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 180, which puts it in the bottom 30% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow TPX in the coming trading sessions, be sure to utilize

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

Tempur Sealy International, Inc. (TPX) - free report >>

Published in