According to a Form 4 filing, Rehan Jaffer’s H Partners Management purchased 776,270 shares of Tempur Sealy International Inc. (NYSE:TPX) this week at prices in the range of $51.36 to $55.00 per share, boosting its overall holding to 7.00 million shares. The freshly-upped position accounts for 11.2% of the company’s outstanding common stock. The shares of the bedding provider have lost 24% since the beginning of 2016 and are down by 4% over the past year. Although Tempur Sealy delivered a great financial performance last year, the company continues to face some issues with the Danish Tax Authority (SKAT). The company received income tax assessments from SKAT which could result in a significant payment to SKAT if Tempur fails to defend its position or pursues a settlement with SKAT.
Leaving the tax issues aside, the company reported total net sales of $3.15 billion for 2015, compared to $2.99 billion for 2014. Most importantly, total net sales on a constant currency basis grew by 9.4% year-over-year, thanks to growth in both the domestic and international markets. The company’s adjusted earnings per share (EPS) increased by 20.4% year-over-year to $3.19. Indeed, the recent slump in the company’s share price has made the stock a more appealing investment opportunity, but Tempur Sealy International Inc. (NYSE:TPX)’s valuation seems to reflect some worries related to the tax issues mentioned above. The stock trades at a forward P/E multiple of 11.82, which is well below the average of 16.70 for the consumer discretionary sector. Columbus Circle Investors, managed by Clifford G. Fox, upped its stake in Tempur Sealy International Inc. (NYSE:TPX) by 81,602 shares during the fourth quarter to 284,147 shares.
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As revealed by a separate Form 4 filing, ValueAct Capital snapped up 978,800 class A shares of CBRE Group Inc. (NYSE:CBG) this week, at prices that ranged from $23.12 to $23.94 per share. Jeffrey Ubben’s investment firm currently owns 32.31 million shares of the commercial real estate services and investment firm, which constitute 9.67% of its outstanding shares. The company had an exceptional 2015 in terms of financial performance and expects to continue delivering strong bottom- and top-line growth in the quarters to come. However, the stock has plummeted by nearly 32% since the beginning of 2016, pushing the company’s valuation down to earth.
CBRE Group Inc. (NYSE:CBG) reported revenue of $10.9 billion for 2015, which marked an increase of 20% year-over-year and by 26% in local currency. At the same time, its adjusted net income grew by 23% year-over-year to $689.2 million. It should be mentioned that the company’s largest expense represents compensation, as its sales and leasing employees are paid on a commission and bonus basis; hence, it appears that CBRE is well-positioned to tackle any potential worsening market conditions. In the meantime, the company has a forward P/E multiple of 9.36, which rests substantially below the average of 15.87 for the S&P 500 companies. However, it remains to be seen how current economic trends will impact the commercial real estate markets, which have been partly stimulated by the availability of low-cost credit in recent years. David Harding’s Winton Capital lifted its position in CBRE Group Inc. (NYSE:CBG) by approximately 478,000 shares during the final quarter of 2015, to 1.07 million shares.
