Somnigroup International Inc. (SGI)
NYSE:SGI
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Somnigroup International
(NYSE:SGI)
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Rating:65Neutral
Price Target:
$69.00
â–¼(-18.83% Downside)
Action:Reiterated
Date:05/16/26
The score is driven mainly by improving fundamentals (revenue and free-cash-flow strength) and a constructive earnings outlook with synergy execution and reaffirmed guidance. These positives are tempered by weak technicals (price below major moving averages, bearish MACD) and a demanding valuation (high P/E with a modest yield), with leverage and balance-sheet history remaining key risk factors.
Positive Factors
Vertically integrated scale and omni‑channel footprint
Somnigroup’s integrated model—R&D, manufacturing, logistics and a large wholesale plus company‑owned retail footprint—creates durable cost, distribution and innovation advantages. Scale supports mix optimization, faster product rollout, and resilience vs. smaller competitors across cycles.
Negative Factors
Volatile leverage and past negative equity
History of negative equity and sharp year‑to‑year leverage swings raises structural balance‑sheet risk. Elevated leverage limits strategic optionality, increases interest and refinancing vulnerability, and makes performance sensitive to cash flow volatility during demand slowdowns.
Read all positive and negative factors
Positive Factors
Negative Factors
Vertically integrated scale and omni‑channel footprint
Somnigroup’s integrated model—R&D, manufacturing, logistics and a large wholesale plus company‑owned retail footprint—creates durable cost, distribution and innovation advantages. Scale supports mix optimization, faster product rollout, and resilience vs. smaller competitors across cycles.
Read all positive factors
Somnigroup International (SGI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$13.82B
Dividend Yield0.67%
Average Volume (3M)3.18M
Price to Earnings (P/E)37.3
Beta (1Y)1.02
Revenue Growth43.53%
EPS Growth54.97%
CountryUS
Employees12,000
SectorConsumer Cyclical
Sector Strength84
IndustryHousehold & Personal Products
Share Statistics
EPS (TTM)2.49
Shares Outstanding210,340,620
10 Day Avg. Volume3,694,323
30 Day Avg. Volume3,180,686
Financial Highlights & Ratios
PEG Ratio-3.02
Price to Book (P/B)5.92
Price to Sales (P/S)2.46
P/FCF Ratio29.05
Enterprise Value/Market Cap1.46
Enterprise Value/Revenue2.64
Enterprise Value/Gross Profit5.94
Enterprise Value/Ebitda16.59
Forecast
1Y Price Target
$98.50Price Target Upside15.87% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
EPS Forecast (FY)3.15
Revenue Forecast (FY)$7.82B
Somnigroup International Business Overview & Revenue Model
Company Description
Somni is a company specializing in sleep technology and wellness solutions, developing innovative products to enhance sleep quality. The company integrates science-backed methods, smart technology, and data-driven insights to improve sleep pattern...
How the Company Makes Money
SGI primarily makes money by selling mattresses and other sleep-related products through two core routes: (1) wholesale sales to third-party retailers and other business customers, and (2) direct-to-consumer (DTC) sales through company-operated ch...
Somnigroup International Earnings Call Summary
Earnings Call Date:May 07, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 23, 2026
Earnings Call Sentiment Positive
Overall the call communicated a predominantly positive operational and financial performance: strong revenue growth (+12%), robust margin expansion and cash generation, meaningful synergy realization, international outperformance, and a clear plan to offset commodity inflation via pricing. Notable near-term headwinds include weaker industry demand (mid-single-digit decline), Mattress Firm margin pressure, a Q2 commodity-related profit headwind (~$10 million) and elevated leverage (3.1x) that management expects to remediate. The strategic combination with Leggett & Platt and reaffirmed 2026 guidance (EPS $3.00–$3.40) further support a constructive outlook despite cyclical and timing risks.Positive Updates
Strategic M&A: Leggett & Platt Combination
Announced definitive agreement to combine with Leggett & Platt (transaction value ~ $2.5 billion including assumption), expected to close by year-end, accretive to adjusted EPS in year one and to generate additional synergies and vertical-integration benefits.
Negative Updates
Industry Demand Weakness
Management believes global bedding demand declined mid-single digits in Q1 (worse than prior expectation of flat to slightly positive), reflecting macro/geopolitical headwinds and winter weather disruptions.
Read all updates
Q1-2026 Updates
Positive
Negative
Strategic M&A: Leggett & Platt Combination
Announced definitive agreement to combine with Leggett & Platt (transaction value ~ $2.5 billion including assumption), expected to close by year-end, accretive to adjusted EPS in year one and to generate additional synergies and vertical-integration benefits.
Read all positive updates
Company Guidance
Guidance for 2026 calls for adjusted EPS of $3.00–$3.40 on roughly $7.8 billion of consolidated sales (midpoint), with adjusted EBITDA targeted at about $1.45 billion; reported gross margin is expected to be slightly above 45% with nearly 100 basis points of net margin expansion from synergies and operating leverage. Management assumes the global bedding industry will be flat to slightly down, with Tempur Sealy North America like‑for‑like sales growing mid‑single digits, international like‑for‑like growth mid‑single digits, and Mattress Firm like‑for‑like sales growing low‑single digits; intercompany eliminations (between Mattress Firm and Tempur Sealy) are expected to represent ~23% of global Tempur Sealy sales. The plan anticipates the pricing actions will be dollar‑neutral for the year (a ~$50 million uplift to back‑half 2026 like‑for‑like sales and ~ $100 million annualized), a Q2 commodity timing headwind of about $10 million to Tempur Sealy profits, Q1 synergy run‑rate of $15 million (sales) and $50 million (cost), ~ $700 million of advertising, CapEx of ~ $225 million in 2026 (including ~$75 million for Mattress Firm refreshes) with normalized CapEx ~ $200 million thereafter, interest expense of about $230 million, a 25% tax rate, ~213 million diluted shares, and a commitment to deploy at least 50% of 2026 free cash flow to dividends and buybacks while returning leverage (Q1 at 3.1x) to the 2–3x adjusted EBITDA target.Somnigroup International Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
63
Positive
Cash Flow
71
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 7.67B | 7.48B | 4.93B | 4.93B | 4.92B | 4.93B |
| Gross Profit | 3.40B | 3.32B | 2.18B | 2.13B | 2.05B | 2.16B |
| EBITDA | 1.22B | 1.04B | 804.20M | 739.30M | 807.30M | 1.00B |
| Net Income | 521.40M | 384.10M | 384.30M | 368.10M | 455.70M | 624.50M |
Balance Sheet | ||||||
| Total Assets | 11.54B | 11.61B | 5.98B | 4.55B | 4.36B | 4.32B |
| Cash, Cash Equivalents and Short-Term Investments | 110.80M | 134.90M | 117.40M | 74.90M | 69.40M | 300.70M |
| Total Debt | 6.53B | 8.26B | 4.47B | 3.27B | 3.37B | 2.86B |
| Total Liabilities | 8.38B | 8.50B | 5.41B | 4.22B | 4.37B | 4.03B |
| Stockholders Equity | 3.15B | 3.11B | 559.00M | 323.40M | -22.10M | 285.80M |
Cash Flow | ||||||
| Free Cash Flow | 736.80M | 633.20M | 569.20M | 384.90M | 72.30M | 599.80M |
| Operating Cash Flow | 940.20M | 800.10M | 666.50M | 570.30M | 378.80M | 723.10M |
| Investing Cash Flow | -226.10M | -3.02B | -96.70M | -187.80M | -315.60M | -555.70M |
| Financing Cash Flow | -729.90M | 616.90M | 1.08B | -384.30M | -279.10M | 76.50M |
Somnigroup International Technical Analysis
Negative
85.01
Price Trends
74.45
Negative
82.45
Negative
83.71
Negative
Market Momentum
-4.06
Positive
39.42
Neutral
17.03
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SGI, the sentiment is Negative. The current price of 85.01 is above the 20-day moving average (MA) of 71.05, above the 50-day MA of 74.45, and above the 200-day MA of 83.71, indicating a bearish trend. The MACD of -4.06 indicates Positive momentum. The RSI at 39.42 is Neutral, neither overbought nor oversold. The STOCH value of 17.03 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SGI.
Somnigroup International Risk Analysis
Somnigroup International disclosed 21 risk factors in its most recent earnings report. Somnigroup International reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Somnigroup International Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
66 Neutral | $32.99B | 17.44 | 15.18% | 4.85% | -0.08% | 53.37% | |
65 Neutral | $13.82B | 37.30 | 17.26% | 0.67% | 43.53% | 54.97% | |
65 Neutral | $22.93B | 25.51 | 17.45% | 1.38% | 2.22% | 29.40% | |
64 Neutral | $72.30B | 26.46 | 475.13% | 2.67% | 4.26% | -27.12% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
61 Neutral | $32.05B | 12.04 | 143.64% | 5.03% | -16.17% | -13.40% | |
54 Neutral | $11.40B | 16.81 | 2826.17% | 5.05% | -3.69% | 10.26% |
* Consumer Cyclical Sector Average
SGI
Somnigroup International
65.69
1.62
2.53%
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Somnigroup International Corporate Events
Business Operations and StrategyExecutive/Board ChangesShareholder Meetings
Somnigroup Stockholders Approve Governance Changes and Share Increase
Positive
May 15, 2026
At Somnigroup International’s annual meeting of stockholders held on May 13, 2026, investors representing nearly all outstanding shares participated in key governance decisions, including the election of the full slate of board nominees and ...
Business Operations and StrategyStock BuybackDividendsM&A Transactions
Somnigroup Highlights Vertically Integrated Bedding Growth Strategy
Positive
May 7, 2026
On May 7, 2026, Somnigroup International Inc. released an updated investor presentation outlining its strategy as a vertically integrated bedding leader spanning design, manufacturing, logistics and omnichannel retail under brands such as Tempur-P...
Business Operations and StrategyM&A TransactionsRegulatory Filings and Compliance
Somnigroup International to Acquire Leggett & Platt in Merger
Positive
Apr 13, 2026
On April 13, 2026, Somnigroup International agreed to acquire Leggett Platt through a merger in which a Somnigroup subsidiary will combine with Leggett Platt, leaving Leggett Platt as a wholly owned Somnigroup unit. Leggett Platt shareholders ...
Business Operations and StrategyFinancial DisclosuresM&A Transactions
Somnigroup to Acquire Leggett & Platt in All-Stock Deal
Positive
Apr 13, 2026
On April 13, 2026, Somnigroup International Inc. and longstanding supplier Leggett Platt announced a definitive all-stock agreement under which Somnigroup will acquire Leggett Platt in a transaction valued at about $2.5 billion, with LEG shareho...
Business Operations and Strategy
Somnigroup International Hosts Investor Day Outlining Strategic Vision
Positive
Mar 4, 2026
Somnigroup International Inc. held its Investor Day on Wednesday, March 4, 2026, featuring executive management presentations on the company’s strategic vision, growth initiatives across business units, multi-year financial target framework,...
Business Operations and Strategy
Somnigroup Updates Strategy Amid Global Bedding Market Recovery
Positive
Feb 17, 2026
On February 17, 2026, Somnigroup International Inc. released an updated investor presentation outlining its positioning as the world’s largest bedding company and its strategy for capturing growth as the global bedding market recovers. The d...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.