Premium mattress giant Select Comfort (NASDAQ:SNBR) disappointed investors and analysts last week with a worse-than-expected earnings report. As investors in the space are likely well aware by now, mattress stocks are incredibly volatile -- the slightest bit of bad (or good) news sets off double-digit adjustments. Odd, considering the long-term stability of the mattress business, but it can be beneficial to the fast-acting investor. This time was a bit different, as the company missed expectations but managed to comfort investors' concerns going forward. Let's take a closer look at the first-quarter earnings and determine if investors should buy the latest dip in Select Comfort shares.

Earnings recap
Select Comfort didn't miss just Wall Street's expectations but its own as well. Net sales came in at $258 million for the quarter, a 2% discount to last year's $262 million. While that may be a relatively negligible drop, same-store sales in company-owned outlets dropped a heartbreaking 9%, resulting in a bottom-line number of $0.41 per share. 2012's first quarter saw $0.45 per share.

According to management, the flub is due to poor media buying practices. The company apparently drifted from its core media strategy, and fell flat as a result. CEO Shelly Ibach said in the conference call that the problem was rectified immediately upon being identified. Ibach went on to note that since the issue was resolved, sales and traffic have slowly but surely begun to tick back up and should continue to do so throughout the second quarter.

The company continues to invest in R&D to drive product innovation. In January, Select Comfort bought a premium air-filled mattress competitor, Comfortaire, for $15.5 million. Select Comfort's particular style and product offering is now nearly exclusive, allowing the company to focus more on its industry competitors, such as Tempur-Pedic (NYSE:TPX) and Mattress Firm (NASDAQ:MFRM).

Looking ahead, management sees low- to mid-single-digit same-store sales growth, with full-year EPS estimates from $1.30 to $1.45 per share.

What investors need to know
Owning Select Comfort, as well as Tempur-Pedic, can be a painful experience. When an analyst releases a report showing a fall in mattress demand, the stocks swing wildly. Over time, though, Select Comfort has slowly grown market share and increased its national presence through the rollout of its company-owned stores. In five years, the stock is up more than 600%. Tempur-Pedic is up more than 320%. Yet neither stock appears to be particularly pricey, given the growth prospects. At 15.6 times one-year forward earnings (based on the low end of guidance), Select Comfort is likely to grow at an attractive pace over the next few years and could warrant the valuation. Competitor Mattress Firm trades at a similar valuation, as does Tempur-Pedic.

Though Select Comfort's shares are by no means on sale, investors should keep a close eye on the stock's day-to-day activity. At times, Select Comfort and its peers tend to trade like broken stocks, allowing for a brief opportunity to buy discounted growth. If you are lucky enough to catch the drop, Select Comfort is an appealing long-term buy.

Fool contributor Michael Lewis has no position in any stocks mentioned. The Motley Fool owns shares of Tempur-Pedic International. 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.