La-Z-Boy's Hazy Ploy

Want to know what pain is? Just ask La-Z-Boy (NYSE: LZB  ) as it continues to struggle with sluggish demand, high operating costs and cheap Asian imports.

When was the last time you ran into a quarterly earnings press release in which a company announced significant one-time restructuring charges -- pitted against significant one-time restructuring charges the year before? Or how about the ironic sting that comes from having to close down its Pennsylvania manufacturing plants, outsourcing the production of its century-old Pennsylvania House brand?

It's not as though La-Z-Boy is taking the maelstrom lying down in one of its signature recliners. It has made the bitter layoffs. It has broadened its offerings to try to appeal to a younger audience with lower price points.

It hasn't helped. The company saw its fiscal first-quarter sales inch up by just 3%. Wall Street isn't the forgiving kind; the company's stock is trading for half of what it peaked at two years ago. It's not pretty -- in fact it's plaid-upholstered ugly -- but let's not coat the entire sector with those pessimistic strokes. Three months ago, I wrote that La-Z-Boy was fumbling this golden opportunity in which low interest rates were drawing in new home buyers with homes to furnish and the cheap dollar should have companies wondering about how much they could export instead of holding back the imports.

Furniture companies can pan out as cozy investments. Hooker Furniture (Nasdaq: HOFT  ) has seen its stock more than double since being recommended in our Motley Fool Hidden Gems newsletter last summer. Stanley Furniture (Nasdaq: STLY  ) has seen its sales grow for nine consecutive quarters.

But La-Z-Boy has a long way to go to get back on the road to prosperity. Yet when the only thing lower than a company's hope is its operating margin, that's often the dinner bell for contrarians. They better be careful, though. Getting all the way from Wall Street to Michigan isn't easy when you have to skirt around Pennsylvania.

If you have your La-Z-Boy tilted all the way back in the living room, can you still reach the remote? What are the couch potatoes watching on the tube this summer? Are there any standouts beyond the reruns, or is everyone just waiting for the Olympics? All this and more -- in the Television Banter discussion board. Only on Fool.com.

Longtime Fool contributor Rick Munarriz has driven to Michigan by way of Pennsylvania before. He does not own shares in any companies mentioned in this story.