Following the likes of Apple (NASDAQ:
), Tempur-Pedic International (NYSE:
) announced Tuesday that it opened its first retail store. Shares
of the mattress producer rose markedly after the announcement.
The new store is intended to engage consumers, according to
"We're excited to bring our products to life in a retail
environment designed to provide product education, build consumer
awareness and enhance brand loyalty," said Patrice Varni, Vice
President of direct-to-consumer sales and marketing in a
The 3,500 square-foot Massachusetts store opening will be the
first of many over the next year, announced Tempur-Pedic. The
company said it will open a second store later this year in
Tempur-Pedic's venture into retail may be its latest effort to
fight falling revenues and margins from the most recently reported
quarter. Last week, the company unveiled TEMPUR-Weightless and
TEMPUR-Breeze mattresses to provide improved responsiveness and
climate control, respectively.
"The specialty mattress market in the U.S. has experienced
ongoing and dramatic change in recent months, characterized by a
crowded, complicated and competitive retail environment," wrote
Oppenheimer in an August 1 research note.
Tuesday's news comes in the wake of a more than 35 percent
year-to-date decline in Tempur-Pedic shares. Much of this decline
occurred in early June, when the company released full-year
earnings per share and revenue projections below Wall Street
Late July, however, the company reported second-quarter earnings
that exceeded analysts' lowered expectations by a margin of more
than 15 percent.
Competitor Sealy Corporation (NYSE:
) traded around 5.8 percent higher year-to-date. The company beat
or met analyst earnings per share estimates for the first two
quarters of 2012, following a notable earnings miss in
Tempur-Pedic was trading approximately 5.2 percent higher for
the day while Sealy Corporation traded higher by around 0.6
Disclosure: At the time of this writing, I did not own shares of
any companies mentioned in this post.
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