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Unpacking Q1 Earnings: Tempur Sealy (NYSE:TPX) In The Context Of Other Home Furnishings Stocks


Jabin Bastian /
2024/07/11 7:48 am EDT

As the Q1 earnings season comes to a close, it’s time to take stock of this quarter's best and worst performers in the home furnishings industry, including Tempur Sealy (NYSE:TPX) 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 13.5% on average since the previous earnings results.

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 mixed quarter for the company with a narrow beat of analysts' earnings estimates but a miss of analysts' Direct revenue estimates.

Company Chairman and CEO Scott Thompson commented, "We are pleased to report solid first quarter sales, earnings and record operating cash flow against a global backdrop which appears to be at a historical nadir. The strong reception to our newly launched innovative products and our ongoing investment in compelling marketing to support the industry, combined with our broad-based omni-channel reach and our commitment to driving operational efficiencies, drove our industry outperformance in the first quarter. Although we look forward to the market's recovery, this recessionary environment provides opportunity to highlight the strength of our global business model and our leading competitive position. We continue to invest in our key initiatives and expect to emerge from the current downturn positioned well for long term success.

Tempur Sealy Total Revenue

The stock is down 6.9% since reporting and currently trades at $46.65.

Read our full report on Tempur Sealy 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 market seems happy with the results as the stock is up 10.7% since reporting. It currently trades at $37.72.

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

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 and revenue estimates.

As expected, the stock is down 37.9% since the results and currently trades at $1.05.

Read our full analysis of Purple's results here.

Lovesac (NASDAQ:LOVE)

Known for its oversized, premium beanbags, Lovesac (NASDAQ:LOVE) is a specialty furniture brand selling modular furniture.

Lovesac reported revenues of $132.6 million, down 6.1% year on year, surpassing analysts' expectations by 3.6%. Looking more broadly, it was an impressive quarter for the company with optimistic earnings guidance for the next quarter and full-year revenue guidance exceeding analysts' expectations.

Lovesac achieved the highest full-year guidance raise among its peers. The stock is down 11.4% since reporting and currently trades at $23.03.

Read our full, actionable report on Lovesac 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%. Looking more broadly, 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 up 2.5% since reporting and currently trades at $112.94.

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

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