We're also removing Sleep Number (SNBR) and Tempur Sealy (TPX) from our Short Bias list. The outsized unit consumption of mattresses seen in 2020 and 2021 meant an industry decline in 2022. SNBR was our favorite short in the mattress space and we went short in summer 2021 with the stock around $105 (it is now at $25). Earnings estimates for 2022 at SNBR have fallen from $7.40 to $1.70. TPX has seen EPS estimates fall from $3.78 to $2.57. While most of retail has a tough growth comparison in 1H23, these two have easy compares and might even be able to grow earnings in 2023. With estimates much lower, and rate of change likely at or near trough, we're removing these shorts.
