Opinions
Colin Stewart
Tempur Pedic International
TPX-N
PAST TOP PICK
Nov 05, 2013
$40.310
Stock price when the opinion was issued
Consumer Products
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TOP PICK
Leading manufacturer of non-coil mattresses. Stock reacted poorly to its recent earnings report. Company met consensus estimates, guided in line but this company has historically raised guidance every time they issue a quarterly report and when they didn't do it this time, it caused the sellers to come out. Announced a discount on one of their mattress lines which concerned people about possible competition. Looking at $4 in earnings this year and $4.75 next year.
Consumer Products
TOP PICK
Has just bought their largest competitor, Sealey, which is complementary as they had different types of products, distribution channels, geographic profile and it will be very accretive to earnings. Offers exposure to a recovering US housing market. At the beginning of the year was trading at 22-23 times earnings and then reported 2 lacklustre quarters and is now trading at 12X earnings. Good business.
Consumer Products
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(Top Pick Oct 23/12, Up 25.20%) Was a play on the Americans. He sold although he is still bullish on the US housing market. The mattress business is more volatile than one would think. He got frustrated with the fluctuations in the business.