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Home Furnishings Stocks Q1 In Review: Purple (NASDAQ:PRPL) Vs Peers


Max Juang /
2024/07/04 8:50 am EDT

Looking back on home furnishings stocks' Q1 earnings, we examine this quarter's best and worst performers, including Purple (NASDAQ:PRPL) and its peers.

A healthy housing market is good for furniture demand as more consumers are buying, renting, moving, and renovating. On the other hand, periods of economic weakness or high interest rates discourage home sales and can squelch demand. In addition, home furnishing companies must contend with shifting consumer preferences such as the growing propensity to buy goods online, including big things like mattresses and sofas that were once thought to be immune from e-commerce competition.

The 6 home furnishings stocks we track reported a decent Q1; on average, revenues beat analyst consensus estimates by 1.2%. while next quarter's revenue guidance was in line with consensus. Stocks, especially growth stocks where cash flows further in the future are more important to the story, had a good end of 2023. But the beginning of 2024 has seen more volatile stock performance due to mixed inflation data, and home furnishings stocks have had a rough stretch, with share prices down 14.2% on average since the previous earnings results.

Weakest Q1: Purple (NASDAQ:PRPL)

Founded by two brothers, Purple (NASDAQ:PRPL) creates sleep and home comfort products such as mattresses, pillows, and bedding accessories.

Purple reported revenues of $120 million, up 12.5% year on year, falling short of analysts' expectations by 1.7%. It was a weak quarter for the company, with a miss of analysts' earnings estimates.

Chief Executive Officer, Rob DeMartini, said "We are encouraged by our start to the year as our first quarter performance was in-line with our guidance despite continued industry softness. Momentum in our business has been accelerating since the mid-2023 launch of our new product portfolio and brand repositioning, leading to market share gains and a return to growth. We are making important progress executing the key initiatives that we believe will deliver sequential top-line improvement as 2024 unfolds and allow us to generate positive adjusted EBITDA in the second half of the year. Longer-term, we are confident that Purple's innovative and differentiated sleep technology combined with the team and strategies that we have in place will fuel profitable growth and increased shareholder value."

Purple Total Revenue

Purple pulled off the fastest revenue growth of the whole group. The stock is down 33.7% since the results and currently trades at $1.12.

Read our full report on Purple here, it's free.

Best Q1: La-Z-Boy (NYSE:LZB)

The prized possession of every mancave, La-Z-Boy (NYSE:LZB) is a furniture company specializing in recliners, sofas, and seats.

La-Z-Boy reported revenues of $553.5 million, down 1.4% year on year, outperforming analysts' expectations by 7.2%. It was an exceptional quarter for the company, with an impressive beat of analysts' earnings estimates and a narrow beat of analysts' Wholesale revenue estimates.

La-Z-Boy Total Revenue

La-Z-Boy delivered the biggest analyst estimates beat among its peers. The stock is up 7% since the results and currently trades at $36.46.

Is now the time to buy La-Z-Boy? Access our full analysis of the earnings results here, it's free.

Leggett & Platt (NYSE:LEG)

Founded in 1883, Leggett & Platt (NYSE:LEG) is a diversified manufacturer making products for various industries.

Leggett & Platt reported revenues of $1.10 billion, down 9.6% year on year, falling short of analysts' expectations by 2%. It was a weak quarter for the company, with a miss of analysts' revenue estimates and underwhelming earnings guidance for the full year.

Leggett & Platt had the weakest performance against analyst estimates, slowest revenue growth, and weakest full-year guidance update in the group. The stock is down 38.2% since the results and currently trades at $11.16.

Read our full analysis of Leggett & Platt's results here.

Tempur Sealy (NYSE:TPX)

Established through the merger of Tempur-Pedic and Sealy in 2012, Tempur Sealy (NYSE:TPX) is a bedding manufacturer known for its innovative memory foam mattresses and sleep products

Tempur Sealy reported revenues of $1.19 billion, down 1.5% year on year, falling short of analysts' expectations by 1.3%. It was a weaker quarter for the company, with a miss of analysts' revenue estimates.

The stock is down 6.7% since the results and currently trades at $46.77.

Read our full, actionable report on Tempur Sealy here, it's free.

Mohawk Industries (NYSE:MHK)

Established in 1878, Mohawk Industries (NYSE:MHK) is a leading producer of floor-covering products for both residential and commercial applications.

Mohawk Industries reported revenues of $2.68 billion, down 4.5% year on year, surpassing analysts' expectations by 1.4%. It was a strong quarter for the company, with a solid beat of analysts' organic revenue estimates and a decent beat of analysts' earnings estimates.

The stock is down 0.3% since the results and currently trades at $109.85.

Read our full, actionable report on Mohawk Industries here, it's free.

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