This story originally appeared on Zacks
Tempur Sealy (TPX) closed at $45.66 in the latest trading session, marking a -1.55% move from the prior day. This change lagged the S&P 500’s daily loss of 1.03%. Elsewhere, the Dow lost 1.48%, while the tech-heavy Nasdaq lost 0.24%.
Coming into today, shares of the mattress maker had gained 4.91% in the past month. In that same time, the Retail-Wholesale sector lost 7.03%, while the S&P 500 lost 0.62%.
Tempur Sealy will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $0.96, up 43.28% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $1.46 billion, up 37.77% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $3.27 per share and revenue of $5.03 billion, which would represent changes of +71.2% and +36.73%, respectively, from the prior year.
Investors should also note any recent changes to analyst estimates for Tempur Sealy. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company’s business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Tempur Sealy is currently a Zacks Rank #2 (Buy).
Looking at its valuation, Tempur Sealy is holding a Forward P/E ratio of 14.2. For comparison, its industry has an average Forward P/E of 14.2, which means Tempur Sealy is trading at a no noticeable deviation to the group.
We can also see that TPX currently has a PEG ratio of 0.59. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. Retail – Home Furnishings stocks are, on average, holding a PEG ratio of 1.11 based on yesterday’s closing prices.
The Retail – Home Furnishings industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 20, putting it in the top 8% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual 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 Zacks.com.
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