Somnigroup International (SGI) AI Stock Analysis

• Market Cap: $13.79B
• Dividend Yield: 0.91%
• Average Volume (3M): 3.00M
• Price to Earnings (P/E): 42.4
• Beta (1Y): 1.14
• Revenue Growth: 8.96%
• EPS Growth: -22.99%
• Country: US
• Employees: 12,000
• Sector: Consumer Cyclical
• Sector Strength: 59
• Industry: Household & Personal Products
• EPS (TTM): 0.49
• Shares Outstanding: 208,584,880
• 10 Day Avg. Volume: 2,022,462
• 30 Day Avg. Volume: 2,998,404
• PEG Ratio: -0.75
• Price to Book (P/B): -271.69
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 83.05
• Enterprise Value/Market Cap: 0.67
• Enterprise Value/Revenue: 0.46
• Enterprise Value/Gross Profit: 4.14
• Enterprise Value/Ebitda: 3.05
• 1Y Price Target: $70.60
• Price Target Upside: 8.43% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 7

• Rating: 77 Outperform
• Price Target: $73.00 ▲(12.12%Upside)

Somnigroup International demonstrates strong financial performance and technical momentum, but is tempered by valuation concerns due to high P/E ratio. Positive corporate events and a mixed earnings call sentiment further influence the score.

Positive Factors

International Sales

Analyst is optimistic around the potential for sales upside, particularly in the international segment with over 6% growth.

Market Share

SGI continues to gain market share with new Sealy Posturepedic hybrid beds and the Tempur-Pedic brand, offsetting underperforming Stearns & Foster.

Strategic Partnerships

The company also recently announced new supply and distribution partnership agreements, further supporting its position as the industry leader.

Negative Factors

Gross Margin

Gross margin of 42.2% decreased by some 115 basis points year-over-year and landed nearly 105 basis points below the Street’s expectations of 43.3%.

Sales and Earnings Outlook

Management brought down its outlook for sales by 3% and EPS by 12%.

Sales Performance

North America sales were down 22% year over year (versus consensus of a 15% decline).

Somnigroup International Business Overview & Revenue Model

Company Description

Somnigroup International (SGI) is a leading company specializing in the development and distribution of advanced sleep-related products and technologies. Operating within the health and wellness sector, SGI offers a diverse range of products, including high-tech sleep tracking devices, premium mattresses, and personalized sleep solutions designed to enhance sleep quality and overall wellbeing. With a commitment to innovation and research, SGI aims to revolutionize the way individuals approach sleep health globally.

How the Company Makes Money

Somnigroup International generates revenue through a combination of product sales, subscription services, and strategic partnerships. The company sells its sleep-related products directly to consumers through its online platform and retail partners, earning a substantial portion of its revenue from these transactions. Additionally, SGI offers subscription-based services for its digital sleep tracking platform, providing users with personalized insights and recommendations for a recurring fee. The company also engages in collaborations with healthcare providers and wellness centers, integrating its technologies into broader health solutions, which further contributes to its earnings.

Somnigroup International Financial Statement Overview

Summary

Somnigroup International shows strong revenue growth and profitability. The income statement is robust with consistent revenue growth and good profit margins. The balance sheet reflects high leverage but is supported by efficient use of funds. Cash flow is positive, showcasing effective cash management.

Income Statement

Somnigroup International has demonstrated consistent revenue growth over the years, with a notable increase in gross profit margin, indicating improved cost management. The net profit margin has been stable, reflecting effective expense control. EBIT and EBITDA margins have shown healthy levels, contributing to robust profitability. Despite minor fluctuations, the overall trajectory is positive, showcasing strong financial performance.

Balance Sheet

The company maintains a high debt-to-equity ratio, suggesting significant leverage. However, the positive return on equity indicates efficient use of shareholder funds. The equity ratio is relatively low, implying reliance on debt financing. While this presents potential risk, the company's ability to generate returns tempers concerns.

Cash Flow

Operating cash flow has consistently covered net income, showing strong cash generation capabilities. Free cash flow growth has been positive, supporting capital expenditures and financing activities. The cash flow ratios reflect effective cash management, although high financing cash flows suggest reliance on external funding.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
5.35B	4.93B	4.93B	4.92B	4.93B	3.68B
	Gross Profit
2.25B	2.18B	2.13B	2.05B	2.16B	1.64B
	EBIT
515.90M	634.20M	607.20M	680.60M	912.30M	532.10M
	EBITDA
702.90M	804.20M	739.30M	807.30M	1.00B	627.40M
	Net Income Common Stockholders
274.90M	384.30M	368.10M	455.70M	624.50M	348.80M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
111.10M	117.40M	74.90M	69.40M	300.70M	65.00M
	Total Assets
11.33B	5.98B	4.55B	4.36B	4.32B	3.31B
	Total Debt
2.02B	4.47B	3.27B	3.37B	2.86B	1.70B
	Net Debt
1.91B	4.35B	3.19B	3.30B	2.56B	1.64B
	Total Liabilities
8.58B	5.41B	4.22B	4.37B	4.03B	2.80B
	Stockholders Equity
2.74B	559.00M	323.40M	-22.10M	285.80M	503.60M
Cash Flow		Free Cash Flow
552.90M	569.20M	384.90M	72.30M	599.80M	543.40M
	Operating Cash Flow
642.70M	666.50M	570.30M	378.80M	723.10M	654.70M
	Investing Cash Flow
-2.92B	-96.70M	-187.80M	-315.30M	-554.80M	-146.60M
	Financing Cash Flow
2.30B	1.08B	-384.30M	-279.10M	76.50M	-522.60M

Somnigroup International Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 65.11
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SGI, the sentiment is Positive. The current price of 65.11 is below the 20-day moving average (MA) of 65.28, above the 50-day MA of 62.15, and above the 200-day MA of 57.30, indicating a neutral trend. The MACD of 0.90 indicates Positive momentum. The RSI at 54.30 is Neutral, neither overbought nor oversold. The STOCH value of 74.69 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SGI.

Somnigroup International Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IPAR	82 Outperform	$4.48B	27.12	22.16%	2.29%	10.32%	18.55%
HIMS	77 Outperform	$12.37B	83.78	36.79%	―	85.99%	―
SGI	77 Outperform	$13.79B	42.42	17.92%	0.91%	8.96%	-22.99%
ELF	75 Outperform	$6.64B	61.42	15.97%	―	28.28%	-14.79%
Sector *	63 Neutral	$6.98B	11.41	2.80%	4.24%	2.68%	-24.94%
COTY	59 Neutral	$4.48B	40.12	-10.58%	―	-1.68%	-302.11%
EL	59 Neutral	$25.35B	147.29	-17.27%	1.99%	-3.70%	-235.59%

Somnigroup International Corporate Events

Somnigroup International Holds Annual Stockholders Meeting

On May 14, 2025, Somnigroup International held its Annual Meeting of Stockholders where 168,959,709 shares were represented out of the 208,582,329 outstanding shares. During the meeting, all company nominees for director positions were elected, Ernst and Young LLP was ratified as the independent auditor for the year ending December 31, 2025, and the compensation of the company’s named executive officers was approved on an advisory basis.

The most recent analyst rating on (SGI) stock is a Buy with a $61.00 price target. To see the full list of analyst forecasts on Somnigroup International stock, see the SGI Stock Forecast page.

Somnigroup Announces Secondary Stock Offering Completion

On May 12, 2025, Somnigroup International Inc. announced a secondary offering of 15,376,743 shares of its common stock by the former majority shareholder of Mattress Firm Group Inc., a subsidiary of IBEX Topco B.V. The shares were sold to Goldman Sachs & Co. LLC, acting as the sole underwriter, and Somnigroup will not receive any proceeds from this transaction. The offering was registered under the Securities Act of 1933, and the shares were sold on May 13, 2025. This transaction does not involve Somnigroup issuing or selling any new shares, and it is part of a broader strategy to manage shareholder interests and market positioning.

The most recent analyst rating on (SGI) stock is a Buy with a $61.00 price target. To see the full list of analyst forecasts on Somnigroup International stock, see the SGI Stock Forecast page.

Somnigroup International Releases Updated Investor Presentation

On May 8, 2025, Somnigroup International Inc. released an updated investor presentation to be used in meetings with investors. The presentation highlights the company’s strategic direction, focusing on consumer-centric innovation and operational excellence. Somnigroup’s vertically integrated strategy and robust capital allocation are designed to optimize consumer experience and drive sales growth. The company anticipates tariff impacts in 2025, with potential price increases to be passed to consumers. Since 2015, Somnigroup has seen significant growth in sales, EBITDA, and EPS, reflecting its strong market positioning and effective management.