Mattress Sales Falling, Stocks Plummeting (TPX, SCSS, MFRM, ZZ)

Mattress maker Tempur Pedic International Inc. (NYSE: TPX) updated full-year and second-quarter guidance this morning and investors did not like what the company had to say. Sales in the second quarter “have been below the company’s plan” and, while Tempur Pedic does not normally provide quarterly guidance, it is making an exception this year.

Other mattress makers, including Select Comfort Corp. (NASDAQ: SCSS), Mattress Firm Holding Corp. (NASDAQ: MFRM), and Sealy Corp. (NYSE: ZZ), are sure to feel the effect of Tempur Pedic’s announcement. Mattress Firm, especially, because the company reported weak quarterly numbers after markets closed last night.

Tempur Pedic expects second quarter sales to be -3% to -5% below the same period last year, driven by a drop of -8% in North American sales. Diluted EPS is now expected to be -50% below the second quarter of 2011.

Sales in the second-quarter of 2011 totaled $342.2 million and the consensus estimate for the current quarter was $393.7 million. Tempur Pedic now expects sales in a range of $325.1-$332 million. Second quarter EPS in 2011 totaled $0.76 and the consensus estimate for this quarter had been $0.85. The company now says EPS will come in at around $0.38.

For the full year, sales are now forecast at $1.43 billion compared with $1.42 billion a year ago and a consensus estimate of $1.65 billion. Full-year EPS is now guided at $2.70, compared with last year’s EPS of $3.18 and the consensus estimate for this year of $3.93.

Mattress Firm’s first quarter revenues missed revenue estimates but beat the adjusted EPS view. For the second quarter, however, the company now expects sales of $270-$275 million compared with a consensus estimate of $278.3 million. The company also expects EPS for the second quarter of $0.26-$0.29, in line with the consensus estimate of $0.27. For the full-year, Mattress Firm guided EPS to $1.46-$1.50, below the consensus estimate of $1.51, on sales of $1.03-$1.06 billion, in line with estimates.

In pre-market trading this morning, Tempur Pedic is getting crushed, down -36% at $27.90, which would be a new 52-week low. The stock’s current 52-week range is $41.53-$87.43.

Mattress Firm is down more than -16% at $29.50 in a 52-week range of $21.03-$48.18.

Select Comfort shares are down -15% at $22.00 in a 52-week range of $11.89-$35.60. Sealy shares have not traded yet this morning.

Paul Ausick