PRPL - Purple Innovation is cut at BofA with Tempur Sealy seen as competitive threat

Bank of America lowers its rating on Purple Innovation (NASDAQ:PRPL) to Underperform from Buy. Analyst Curtis Nagle and team take a more cautious view on TPX based on what they call weak online and wholesale trends into Q3. The announcement last week that Tempur Sealy International (NYSE:TPX) is introducing a direct competitor to PRPL’s gel grid-based beds next year is also called significant. "TPX is by far the largest competitor in the space (35% share in ‘20, see ex. 4), has been taking significant share and has strong product know how and manufacturing capacity. We see this as the first real competitive threat to PRPL and it could disrupt volume growth, pricing and wholesale expansion. This also comes at a very difficult time for PRPL after a year of execution and capacity issues, and questions on when a turnaround could begin." BofA assigns a price objective of $16 to Purple

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Purple Innovation is cut at BofA with Tempur Sealy seen as competitive threat