Tempur Sealy International (TPX) - Get Report rose Wednesday on news that the chief executive of the Mattress Firm resigned, raising the chances of having its mattresses distributed by the retailer again.
Tempur Seally was trading up more than 6% to around $63.22 after the Mattress Firm's chief executive Steve Stagner said he was quitting after 23 years at the retailer.
"We view this as a positive development" for Tempur Sealy, said a team of Wedbush analysts led by Seth Basham in a note provided to TheStreet.
Citing Stagner's "rocky" relationship with senior management of Tempur, Basham and his colleagues said that with the CEO the chances rise that Mattress Firm will "rekindle" a distribution agreement with Tempur Sealy.
"We continue to rate TPX OUTPERFORM on the basis of improving fundamentals and the potential for a new agreement" with Mattress Firm, the analysts wrote.
The Mattress Firm's board said in a statement that it has started an executive search for a new chief executive.
"It has been my honor and privilege to have served the passionate and hardworking team at Mattress Firm for more than two decades," said Stagner in a statement. "I am looking forward to spending more time with my family after a busy year and will continue to root for Mattress Firm as they evolve and grow."
Tempur Sealy didn't immediately respond to a request for comment.