Bull Of The Day: Sleep Number (SNBR)

Let’s get the bad news out of the way first. Sleep Number (SNBR - Free Reportproducts are not inexpensive. During an economic recession when budgets are strained, consumers stop buying luxury items first. That’s obvious, right?

As clear as it might seem, it’s also not actually correct.

Sleep Number is in a somewhat unique position of providing products that appeal directly to what people are craving most during unsettling times – comfort. It’s a tired cliché to describe a conservative investment as “something that lets you sleep at night,” but in the case of Sleep Number, it’s true – both figuratively and literally.

There’s an obvious demand for comfort items right now and Sleep Number is finding themselves right in the sweet spot, supplying the exact thing people are craving most in a significantly uncertain world – that (unfortunately elusive) restful night of sleep.

Founded more than 30 years ago and quickly becoming the first large-scale manufacturer of high-tech pneumatic mattresses, Sleep Number owns 40 unique patents on the technology and dominates the market. Through a network of more than 600 retail locations, direct marketing and internet sales, Sleep Number has made their name basically synonymous with the concept of adjustable sleep technology.

Loyal customers support the brand and provide basically free marketing for Sleep Number, using social media to extol the virtues of the company’s technologies and the customizable nature of having your side of the bed exactly the way you like it - even if your partner prefers something much different.

Sleep number isn’t just a compelling story however, it’s also a great business. Their results during the most recent quarter – which included the month of March 2020 when fears about the pandemic kept many customers out of malls and retail stores – were basically a home run.

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