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Category: Stock Market and Sleep Number
Date: 16 October 2019 Stock Price: $46.86 We take a look at the 3rd quarter earnings report of their 2019 fiscal year of Sleep Number a company providing individualized sleep experiences to ensure people get a good night's rest.
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About Sleep Number
The leader in sleep innovation, Sleep Number delivers proven, quality sleep through effortless, adjustable comfort and biometric sleep tracking. Sleep Number’s revolutionary 360® smart bed and proprietary SleepIQ® technology platform are proving the connection between sleep and well-being. With one of the most comprehensive databases of biometric consumer sleep data, and as the winner of J.D. Power’s 2018 Mattress Satisfaction Report, Sleep Number is improving lives by individualizing sleep experiences. And with a commitment to improving the lives of over 1 million youth by 2025, Sleep Number is redefining the future of health and wellness – for everyone. To experience better quality sleep, visit our sleepnumber.com or one of our over 590 Sleep Number® stores located in all 50 states.
Overview of Sleep Number's latest earnings report
Data below refers to quarterly data unless specified otherwise:
- Net sales: $474.778 million (up from $414.779 million for the same period of the previous year)
- Net sales increased by 14.4% over the last 12 months
- Cost of sales: $178.388 million (up from $164.262 million for the same period of the previous year)
- Cost of goods sold increased by 8.6% over the last 12 months
- Net income: $28.054 million (up from $18.257 million for the same period of the previous year)
- Diluted earnings per share: $0.94 (up from $0.52 for the same period of the previous year)
- PE ratio of Sleep Number.: 12.7
- Diluted weighted-average shares outstanding: 29.796 million (down from 35.039 million for the same period of the previous year)
- Cash and cash equivalents: $1.54 million
- Cash and cash equivalents per share: $0.05
- Cash and cash equivalents makes up 011% of Sleep Number's market capital
- Cash and cash equivalents makes up 0.19% of Sleep Number's total assets
- Accounts receivable: $25.541 million
- Accounts receivable makes up 3.18% of Sleep Number's total assets
- Goodwill of Sleep Number's: $73.772 million
- Goodwill per share: $2.48
- Goodwill makes up 9.19% of Sleep Number's total assets
- Cash generated from operations (for the 9 months): $189.832 million
- Cash generated from operations per share (for the 9 months): $6.37
Sleep Number's management commentary on the results
MINNEAPOLIS--(BUSINESS WIRE)--Oct. 15, 2019-- Sleep Number Corporation (Nasdaq: SNBR) today reported record results for the third quarter and year-to-date period ended September 28, 2019. “Our revolutionary Sleep Number 360® smart beds are delivering life-changing sleep and drove double-digit demand growth on top of double-digit demand growth the prior year. Our multi-year initiatives are resulting in the sales and profit growth we anticipated,” stated Shelly Ibach, President and CEO. “We are creating a future where our 360® smart bed will be the hub for consumers’ health and wellness with individualized digital health as core to our business.”
Third Quarter Overview
Financial Outlook
The company raised its 2019 earnings per diluted share outlook to a range of $2.45 to $2.75. The outlook includes up to 10% net sales growth for the full-year and a 25% effective income tax rate for the fourth quarter.
Third Quarter Overview
- Net sales increased 14% to a record $475 million, including a 10% comparable sales gain
- Prior year’s reported results were impacted by one week of deliveries ($24 million of net sales and 23 cents of EPS) which shifted from the third to the fourth quarter; refer to the Reconciliation of Non-GAAP Financial Measures tables on page 10 of our fourth quarter 2018 earnings press release
- Gross profit rate increased 200 basis points to 62.4% of net sales compared with 60.4% for the same period last year
- Operating income increased 55% to $39 million, or 8.2% of net sales, up 210 basis points versus the prior year’s third quarter
- Earnings per diluted share increased 81% to $0.94, compared with $0.52 for the prior year
Financial Outlook
The company raised its 2019 earnings per diluted share outlook to a range of $2.45 to $2.75. The outlook includes up to 10% net sales growth for the full-year and a 25% effective income tax rate for the fourth quarter.
Sleep Number (NASDAQ: SNBR) stock price history
The image below, obtained from Google, shows the stock price history of Sleep Number over the last 5 years. And it's been a very good time for Sleep Number stockholders. 5 years ago the stock was trading at around $21.10 a stock and its currently trading at $46.86 a stock. Thats a return of 122% provide to Sleep Number Corp shareholders over the last 5 years.
The stock of Sleep Number Corp is trading at a lot closer to its 52 week high of $52.08 than it is to its 52 week low of $30.44 which to us is a indication that the short term momentum and sentiment of Sleep Number Corp stock is very positive at this point in time.
The stock of Sleep Number Corp is trading at a lot closer to its 52 week high of $52.08 than it is to its 52 week low of $30.44 which to us is a indication that the short term momentum and sentiment of Sleep Number Corp stock is very positive at this point in time.
Sleep Number Corp (NASDAQ: SNBR) stock price history over the last 5 years
Recent coverage of Sleep Number
The extract below discusses the latest earnings results from Sleep Number as obtained from TheStreet.com
Sleep Number Corporation (Nasdaq: SNBR) today reported record results for the third quarter and year-to-date period ended September 28, 2019. "Our revolutionary Sleep Number 360 ® smart beds are delivering life-changing sleep and drove double-digit demand growth on top of double-digit demand growth the prior year. Our multi-year initiatives are resulting in the sales and profit growth we anticipated," stated Shelly Ibach, President and CEO. "We are creating a future where our 360 ® smart bed will be the hub for consumers' health and wellness with individualized digital health as core to our business.
Sleep Number Corporation (Nasdaq: SNBR) today reported record results for the third quarter and year-to-date period ended September 28, 2019. "Our revolutionary Sleep Number 360 ® smart beds are delivering life-changing sleep and drove double-digit demand growth on top of double-digit demand growth the prior year. Our multi-year initiatives are resulting in the sales and profit growth we anticipated," stated Shelly Ibach, President and CEO. "We are creating a future where our 360 ® smart bed will be the hub for consumers' health and wellness with individualized digital health as core to our business.
Sleep Number (NASDAQ: SNBR) latest stock valuation
So what is Sleep Number stock worth based on the release of their latest earnings report and their outlook for the rest of their 2019 fiscal year? Based on Sleep Number's latest earnings report and their outlook our valuation models provide a target (full value) price for Sleep Number stock at $48.60 a stock. We therefore believe that the stock of Sleep Number is slightly undervalued.
We usually suggest that long term and fundamental investors get in at least 10% below our target (full value) price which in this case is $48.60 Therefore we believe a good entry point into Sleep Number stock is at $43.80 or below. Since the stock price of Sleep Number's is very close to our target price, we expect the stock of of Sleep Number to trade mostly sideways in coming weeks and months around our target (full value) price of $48.60
We usually suggest that long term and fundamental investors get in at least 10% below our target (full value) price which in this case is $48.60 Therefore we believe a good entry point into Sleep Number stock is at $43.80 or below. Since the stock price of Sleep Number's is very close to our target price, we expect the stock of of Sleep Number to trade mostly sideways in coming weeks and months around our target (full value) price of $48.60
Next earnings release date for Sleep Number
It is expected that Sleep Number's 4th quarter 2019 earnings report will be released in early January 2020