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Why Tempur-Sealy, National Beverage, and Ferrellgas Partners Slumped Today

By Dan Caplinger – Updated Sep 28, 2016 at 6:12PM

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Even on an up day for the market, these stocks fell. Find out why.

Image source: Tempur-Sealy.

The stock market gained ground on Wednesday, with the Dow picking up 111 points and the S&P 500 posting a half-percent gain. Strong performance in the oil market carried over into the performance of stocks broadly, and investors believe that the prospect for a healthier commodities market could stoke macroeconomic growth across the globe, supporting U.S. economic prospects. Yet even though many stocks managed to rise, there were still some situations involving bad news that sent individual companies lower. Among them were Tempur-Sealy International (TPX -5.07%), National Beverage (FIZZ -2.81%), and Ferrellgas Partners (FGP).

Tempur-Sealy warns of restless nights ahead

Tempur-Sealy plunged 22% after warning that its third-quarter results are likely to fall short of its previous expectations. In particular, Tempur-Sealy said that full-year sales are likely to be down between 1% and 3% from 2015 levels, and adjusted EBITDA will be in a range of $500 million to $525 million. CEO Scott Thompson tried to put at least some positive spin on the guidance change, noting that "operational initiatives are going well and are continuing to drive considerable margin expansion." Nevertheless, the 5% cut in EBITDA guidance reflects the negative impact of the expected revenue shortfall, and Tempur-Sealy shareholders will have to hope that things don't get any worse before the mattress-maker reports final results in late October.

National Beverage deals with short-seller attacks

National Beverage fell 8% in the wake of criticism of the beverage-maker from a short-seller of the stock. Glaucus Research called National Beverage's accounting practices in question, suggesting that the company has "become a faddish stock market darling" and calling on regulators to look more closely at the company's financials. For its part, National Beverage responded aggressively to the criticism, calling the Glaucus allegations "false and defamatory" and stating that the allegations were initially made "for the purpose of extorting money from the company" in a previously dismissed legal complaint. National Beverage urged shareholders against reacting to the statements, but the stock nevertheless posted sizable losses.

Ferrellgas misses the target

Finally, Ferrellgas fell 21%. The propane gas provider reported its fiscal fourth-quarter and full-year results early Wednesday that disappointed investors. A huge one-time impairment charge was primarily responsible for Ferrellgas Partners' big net loss, but CEO James Ferrell also blamed record temperatures across the nation for the company's poor results throughout the year. The situation has had enough of a negative effect on Ferrellgas' financials that it had to negotiate an amendment to its credit facilities to allow for a higher maximum leverage ratio. To preserve capital, Ferrellgas warned that it might cut its distribution by more than half, and investors were clearly nervous that additional measures might be necessary to ensure the company's survival in the long run.

Dan Caplinger has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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Stocks Mentioned

National Beverage Corp. Stock Quote
National Beverage Corp.
$39.08 (-2.81%) $-1.13
Tempur Sealy International, Inc. Stock Quote
Tempur Sealy International, Inc.
$24.35 (-5.07%) $-1.30
Ferrellgas Partners, L.P. Stock Quote
Ferrellgas Partners, L.P.

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