Sealy's Q2 was not exciting enough for me

The company reported, on an adjusted basis, a profit of 7 cents per share. Expectations were for 8 cents per share. Okay, so Sealy was close. And another cool part had to do with the gross margin. While gross profit on a dollar basis declined on a year-over-year basis, the gross margin increased.

Sales, however, went down by 20%. Cash flow also took a significant drop. And when you consider how the economy has been, and how the company's international operations are doing, I just don't see how I would want to buy Sealy at this stage in the current business cycle. When I look through the press release, I don't perceive there to be any solid plan by management for getting growth going again in place. Instead, the company seems distracted by making sure its financial house in order.

Don't get me wrong, the business needs to focus on such an issue. But it represents a signal to me: a signal not to buy. Sure, Sealy shares could rally further in the coming months, but I'd rather look at the company again when the fundamental situation improves. For now, Sealy just wants to tread water as best it can, and that's just not an exciting enough story for me.

Disclosure: I don't own any company mentioned; positions can change without notice.