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Sleep Number (SNBR) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research
·3 mins read

In the latest trading session, Sleep Number (SNBR) closed at $49.46, marking a +1.12% move from the previous day. This move outpaced the S&P 500's daily gain of 0.53%. Elsewhere, the Dow gained 0.13%, while the tech-heavy Nasdaq added 1.42%.

Heading into today, shares of the seller of beds, mattresses and bedding products had lost 1.69% over the past month, lagging the Consumer Discretionary sector's loss of 1.22% and outpacing the S&P 500's loss of 3.76% in that time.

Wall Street will be looking for positivity from SNBR as it approaches its next earnings report date. The company is expected to report EPS of -$0.41, down 143.62% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $527.95 million, up 11.2% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.80 per share and revenue of $1.77 billion, which would represent changes of +3.7% and +4.16%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for SNBR. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.94% higher. SNBR is holding a Zacks Rank of #2 (Buy) right now.

Looking at its valuation, SNBR is holding a Forward P/E ratio of 17.48. For comparison, its industry has an average Forward P/E of 17.48, which means SNBR is trading at a no noticeable deviation to the group.

We can also see that SNBR currently has a PEG ratio of 8.06. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Furniture was holding an average PEG ratio of 2.13 at yesterday's closing price.

The Furniture industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 30, putting it in the top 12% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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