UPDATE 2-Select Comfort results beat, but outlook disappoints
* Third-quarter EPS $0.46 vs est $0.40
* Third-quarter sales $246.8 mln vs est $246.6 mln
* Raises full-year profit outlook
* Analyst says outlook could have been better
* Shares fall 3 pct aftermarket
Oct 17 (Reuters) - Specialty mattress maker Select Comfort Corp reported higher-than-expected quarterly earnings as more customers took to its new products, prompting the retailer to raise its 2012 profit outlook for the second time this year.
Shares of the Minneapolis, Minnesota-based company fell 3 percent after the bell as investors were looking for a significantly higher upside to full-year profit.
Select Comfort raised its 2012 profit outlook to between $1.51 and $1.53 per share from the $1.41 to $1.47 per share range it forecast earlier.
"Investors usually focus on guidance and it was very good guidance, but it was not significantly above expectations," said Keith Hughes, an analyst at Suntrust Robinson Humphrey.
Analysts on average expect a full-year profit of $1.47 per share, according to Thomson Reuters I/B/E/S.
"The company had very high expectations, which they've met, ... but it'll probably take a greater beat to drive the stock much higher than it is currently," Hughes said.
The company, which sells mattresses at prices ranging from $649 to upwards of $5149, has been innovating its product line and increasing its store count to gain share from rivals such as Tempur-Pedic International Inc and Sealy Corp.
Chief Executive Shelly Ibach said she would continue increasing investments to build the company's brand name and develop new products within its 'Sleep Number' beds and bedding line, in the fourth quarter.
Ibach said the company will launch a new advertising campaign for the upcoming holiday season and open 14 to 18 new stores.
Same-store sales at company-controlled stores rose 21 percent in the third quarter, as customers lapped up its new range of Sleep Number Memory Foam and Sleep Number FlexFit Adjustable Base series, the company said.
Select Comfort which has trumped Wall Street's quarterly profit estimates for seven quarters in a row, reported a net income of $26.2 million, or 46 cents per share for the third quarter, compared with $17.2 million, or 31 cents per share, a year earlier. Analysts expected earnings of 40 cents per share.
Revenue at the company rose 24 percent to $246.8 million, marginally ahead of Wall Street expectations of $246.6 million.
Shares of Select Comfort, which has a market capitalization of about $1.84 billion, closed at $32.63 on Wednesday on the Nasdaq.