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Select Comfort and the Houing Bubble



April 25, 2008 – Comments (4)

SCSS revs vs Single Fam Home completions

Full size here.

That one just shows revenues against single-family home completions (the annual rates, seasonally adjusted).

This one  shows Select Comfort's revenues against median home prices.

SCSS Revs vs Median Home Price

Full size here.

The final shows RE loans at commercial banks vs. Select Comfort Revenues

Full size here.

None of these is perfect. The RE loan picture includes more than just home mortgages, but does not include the enormous number of mortgages made by non-bank lenders and then securitized. But, I think they offer some illustration of how Select Comfort benefitted from the bubble, and just how badly things may go now that it's over.




4 Comments – Post Your Own

#1) On April 25, 2008 at 3:31 PM, XMFHelical (< 20) wrote:


And this consideration - that sales a high $$ home good item would suffer when MEWs diminished and the home cash register ran dry - was well discussed on the HG:SCSS board.  Not just in hindsight - but well ahead of the problem.

As an HG subscriber that exited SCSS with a decent profit, this to me is just more evidence of the utility of 'community' that has always been key to TMF.


P.S. - just ignore my loss in MIDD a few years back.

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#2) On April 26, 2008 at 12:05 AM, FleaBagger (27.45) wrote:

Seth -

How do you change your avatar (or, as they are known in Canadia, "avtar")? 

Zz -

How did you lose money with MIDD? 

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#3) On April 26, 2008 at 10:39 AM, XMFHelical (< 20) wrote:


I lost money on MIDD shortly after they took on debt and bought out the original owner group.  I sold just prior to the quarterly earnings at the end of April 2005, after only owning a few months.  Bought at ~54, sold at ~43.  Of course the had a great quarter and went back up to around my buy price shortly after I sold.  Oh well, my wife had owned it and done well.

As for Avatars - Mine changed too.  TMFJake hooked me up.


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#4) On April 27, 2008 at 5:04 PM, TDRH (97.16) wrote:

Bent, Understand that SCSS products are pretty high end consumer discretionary, but it appears that the balance of this sector has not felt the pain as dramatically.   My gut says that this is the first in a long line of consumer discretionar prodcts that suffer over the next couple of years.    

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