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  • bugyodel bugyodel Jun 6, 2012 11:48 PM Flag

    Run for the hills, longs!

    Remember what happened a few years ago....face it, the consumer needs a new $5K mattress in a recession?
    I think it's about as discretionary as it comes, premium replacement mattresses. Everybody has a bed, so you can live without the new one until you feel like spending (borrowing) on something that you already have.

    Single digits ahead -- just like before.

    Buy the dip with a recessionary storm coming straight at us? You go ahead. I'm buying puts.

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    • Have you ever tried one of these mattresses? They suck!

    • your a fool and sound ignorant!!!!! not only was qtr fantastic...they raised FULL YEAR GUIDANCE!!!!!!! lost 200 on my put play as they will expire worthless but i think will ATLEAST TRIPLE MY LONG CALLS FOR AUGUST!!!!!! no reason not to see 30 within 2 weeks

    • Nice try. The new ceo, dropping Rush, nor anything other than Tempur's announced decline in projected sales had anything to SCSS's drop.

      Tempur's announced decline in projected earnings due to competition's aggressive competitors taking their market share is only good news for SCSS because they're one of the ones that is snagging the extra biz.

      SCSS has been extremely accurate in their sales forecasting of late and the incoming ceo even said in the last earnings call that there was no "mattress event" during the 2d quarter which means that they had already included a slight dip in their original projections so there won't be a decline in projected earnings as in Tempur's recent bombshell that they just dropped on investors.

      Additionally, they only have one bed in the $5k range and those who want it/can afford it will still purchase that model. They still have numerous other models that are more reasonably priced that serve the same purpose. Their target customers are still the aging baby boomer sector when they wake up with back pains, they'll continue to do something about it (ie: purchase a new bed.)

      Tempur's announcement and subsequent free fall is the only thing that made scss's pps fall and not their own productivity and anyone who's paying attention to what's going on will take advantage of this buying opportunity. This company still has virtually no debt what-so-ever and the only thing that has changed over the past month is that it is now priced even more attractively as it will continue it's steady rise to above $40/share by year's end.

      • 1 Reply to thebeachkids
      • Everything this discretionary will get hit hard(er) once it is clearer that recession is back.
        I'm a boomer, my wife had pushed me about a new bed. I told her, not now, bad times...bed we have is good enough for now. And I can afford it, but, again, in these times you just put non-essentials off.
        Most boomers I know are hunkering down big time, losing jobs with no hope of getting new ones, licking their wounds from lack of return they can get on their (shrinking) savings, etc.

        If they need a new bed, plenty of used ones for sale on craigslist at 1/3 of the price of mall store one.
        And, most boomers got the beds they wanted years ago, when times were good.

        More likely will fall in half than double by year end.

 
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