Topic: Growth Stocks

Stock Pickers Digest Hotline – Friday, January 27, 2012

Article Excerpt

TEMPUR-PEDIC, $70.09, symbol TPX on New York, reported higher revenue and earnings in the latest quarter. The company makes and distributes therapeutic mattresses and pillows made from its Tempur material. In the three months ended December 31, 2011, Tempur-Pedic’s earnings rose 21.7%, to $56.3 million from $46.3 million a year earlier. The company bought back $365.9 million of its shares in 2011. Due to fewer shares outstanding, earnings per share rose 26.5%, to $0.86 from $0.68. The company spent more on marketing in the latest quarter, but it has done a good job of cutting its costs and streamlining production. Sales rose 25.3%, to $366.8 million from $292.7 million a year earlier. North American sales rose 26%, and international sales gained 25%. The company’s long-term prospects are bright. However, the shares have risen 62% over the past year, and now trade at 18.2 times the company’s forecast 2012 earnings of $3.86 a share. Tempur-Pedic is a hold. Tempur-Pedic was recently covered in the December 2011 issue…