Tempur Sealy (TPX) PT Raised to $81 at Piper Jaffray Amid 'Healthy' Q2

Piper Jaffray analyst Peter Keith bumped estimates and his price target Overweight-rated Tempur Sealy (NYSE: TPX) to $81.00 (from $77.00) following "healthy" Q2 results.

Keigh commented, "We are reiterating our OW rating and raising our PT to $81 (from $77) based on 20x 2016E EPS (unchanged). Q2 EPS of $0.53 (vs. cons. of $0.45) saw upside from sales and dramatic upside from GM (39.4% vs consensus of 38.1%). We believe Q2 represents an important inflection point for shares as clean execution drove a solid 29% contribution margin on strong sales; and investors should expect more strong margin improvement to come as (1) Sealy margin improvements are very early; (2) $32M price increase benefit is only one quarter in; (3) lower input cost benefits are just beginning to emerge. TPX also announced a CFO transition as long-time CFO Dale Williams is stepping down and being replaced by Barry Hytinen (current EVP of Corp Dev and Finance). Finally, top line trends appear healthy and TPX is seeing good early success with its recent Tempur and Sealy launches."

The firm raised FY 2015 EPS from $3.07 to 3.18 and FY 2016 EPS from $3.83 to $4.06.

For an analyst ratings summary and ratings history on Tempur Sealy click here. For more ratings news on Tempur Sealy click here.

Shares of Tempur Sealy closed at $71.35 yesterday.

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