TPX - Purple Innovation the top pick at UBS in sweeping coverage of mattress sector

UBS takes up coverage on the U.S. mattress industry with four new ratings as it looks at housing as a near-term tailwind. Analyst Atul Maheswari: "We believe the mattress sector should see strong trends over the next few quarters on the back of wallet share gains and continued strength in housing. Some of the long-term unknowns like the shift online & intense competition will likely take a backseat to unit gains over the next couple of quarters. Our top down industry model forecasts the $21 bn mattress industry growing 5.4% in 2020 followed by 4.1% in FY'21. Our 2020 estimate bakes in a -LSD decline for the ~$16.5 bn traditional channel and 35% growth for the ~$4bn DTC channel." Purple Innovation (PRPL) is the top pick in the group from UBS. "PRPL is a profitable DTC player with several unique drivers to sustain 20-25% revenue growth and 25%+ EBITDA growth

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Purple Innovation the top pick at UBS in sweeping coverage of mattress sector