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Sleep Number Stock Outperforms Tesla by 165%

In the last year, Tesla’s stock has appreciated over 635%. That’s more than the FAANG quintet (Facebook, Amazon, Apple, Netflix, and Alphabet)—which all saw significant gains of 50% or more in the same time span.

But there’s a mattress business stock that’s even better than all that tech and Tesla: Sleep Number.

The technology-driven bedding manufacturer gained more than 800% over the last 12 months, which is even more impressive given the fact that their stock bottomed out at $16 a share a year ago.

Their secret? Focusing on sleep, technology, and health instead of mattresses and bedding, starting with their “mission of improving lives by individualizing sleep experiences.”

At the center of the mission—and driving growth for the company—is its 360 Smart Bed. Equipped with the hardware of a bed frame and mattress, the smart bed uses software to communicate with a smartphone app that monitors sleep habits, bringing Sleep Number into the Internet of Things (IoT) arena. 

Like Amazon’s Alexa, Sleep Numbers 360 Smart Bed collects information about a person’s sleeping habits and puts all of that data together to help them get a better night’s sleep. 

By focusing on the goal of sleep—improving people’s lives—Sleep Number has proven itself to be a formidable player in the technology space.

But a worldwide pandemic didn’t hurt, either. With many focusing on their health over the last year, Sleep Number recorded a “48% jump in operating cash flow while increasing fully diluted earnings per share (EPS) by 81%,” according to Investing Daily.

Investing Daily also reports that:

  • The eight Wall Street analysts following Sleep Number aren’t sure what to make of the company’s prospects. Five of them have it rated as ‘hold’ or ‘underperform’, while only three advise buying it at its current share price.
  • The number of shares sold short as a percentage of the float was 18.7% on March 15. Short-sellers bet that the stock they borrow, sell and then buy back to return to the lender, will drop in price. A short interest above 20% of the float is considered very high.

While the pandemic certainly played its part in Sleep Number’s gains, it wasn’t the only factor, and their stock increases are a good example of how powerful the message of sleep and health is for our industry.

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