Don't Sleep on This Value Stock
Sleep Number's stock has been cut in half over the past 12 months. Yet the mattress maker's business fundamentals are impressive, and demand for its products remains high. Here's why this stock could shape up to be anything but a snooze.
Why has the stock been cut in half? In short, Sleep Number was hit especially hard by global supply chain issues in 2021. In the first half of the year, the company struggled with its foam supply -- an essential component for any mattress seller. And even after it shored up its foam suppliers, the company blamed its delivery issues on the supply shortages of semiconductor chips associated with its smart beds and smart bases.
As a result of the company's supply chain issues, and the subsequent freefall in Sleep Number's stock price, a class action lawsuit has been filed against the mattress seller. Yet the company is proactively trying to solve its biggest headache. According to management, Sleep Number has formed direct relationships with its second-tier and third-tier suppliers, buying semiconductor chips through "higher-cost open-market purchases," and employing new tactics to expedite its shipping of needed supplies, including airfreight.
Source Fool.com
