Piper Jaffray Reiterates an 'Overweight' on Sealy Corp. (ZZ); Adjusts Estimates and Price Target

September 30, 2009 6:47 AM EDT

Piper Jaffray & Co. reiterates an 'Overweight' rating on Sealy Corp. (NYSE: ZZ), raises price target from $3 to $4.

Piper analyst says, "Given August quarter operating results were largely in-line with expectations, we are making only minor changes to our growth and margin projections. We are adjusting our interest expense projections going forward to include ~$4M/quarter of non-cash interest expense related to the amortization of fees related to the company's recent refinancing, as well as PIK interest. In sum, our FY09 sales estimate moves from $1.23B to $1.26B, while EPS goes from $0.11 to $0.12. Looking into FY10, our sales estimate improves from $1.30B to $1.35B (+7% Y/Y), and EPS goes from $0.18 to $0.15. Visibility is improved, but consumer risks exist and we expect our estimates could change materially in the coming months."

To see more analyst ratings on ZZ Click Here.

Sealy Corporation engages in the manufacture and marketing of various bedding products in the United States and internationally. Its product line includes mattresses and mattress foundations.

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