TSX:ZZZ

Stock Analysis Report

Sleep Country Canada Holdings

Executive Summary

Sleep Country Canada Holdings Inc., together with its subsidiaries, engages in retailing mattress and bedding related products in Canada.

Snowflake

Fundamentals

Adequate balance sheet and slightly overvalued.


Similar Companies

Share Price & News

How has Sleep Country Canada Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

1.9%

ZZZ

1.1%

CA Specialty Retail

0.2%

CA Market


1 Year Return

-19.5%

ZZZ

-21.7%

CA Specialty Retail

3.5%

CA Market

Return vs Industry: ZZZ exceeded the Canadian Specialty Retail industry which returned -21.7% over the past year.

Return vs Market: ZZZ underperformed the Canadian Market which returned 3.5% over the past year.


Shareholder returns

ZZZIndustryMarket
7 Day1.9%1.1%0.2%
30 Day0.1%-0.4%-3.3%
90 Day19.0%-1.1%-1.9%
1 Year-16.5%-19.5%-19.4%-21.7%7.3%3.5%
3 Year-22.0%-27.9%-21.6%-27.2%14.7%4.4%
5 Yearn/a-29.4%-37.7%26.2%7.7%

Price Volatility Vs. Market

How volatile is Sleep Country Canada Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Sleep Country Canada Holdings undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ZZZ (CA$21.57) is trading below our estimate of fair value (CA$55.58)

Significantly Below Fair Value: ZZZ is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: ZZZ is poor value based on its PE Ratio (14x) compared to the Specialty Retail industry average (13.1x).

PE vs Market: ZZZ is poor value based on its PE Ratio (14x) compared to the Canadian market (13.7x).


Price to Earnings Growth Ratio

PEG Ratio: ZZZ is poor value based on its PEG Ratio (1.6x)


Price to Book Ratio

PB vs Industry: ZZZ is overvalued based on its PB Ratio (2.7x) compared to the CA Specialty Retail industry average (1.4x).


Next Steps

Future Growth

How is Sleep Country Canada Holdings forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

8.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ZZZ's forecast earnings growth (8.9% per year) is above the savings rate (1.9%).

Earnings vs Market: ZZZ's earnings (8.9% per year) are forecast to grow slower than the Canadian market (13% per year).

High Growth Earnings: ZZZ's earnings are forecast to grow, but not significantly.

Revenue vs Market: ZZZ's revenue (7.9% per year) is forecast to grow faster than the Canadian market (5.5% per year).

High Growth Revenue: ZZZ's revenue (7.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if ZZZ's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Sleep Country Canada Holdings performed over the past 5 years?

57.1%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: ZZZ has become profitable over the past 5 years, growing earnings by 57.1% per year.

Accelerating Growth: ZZZ's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: ZZZ had negative earnings growth (-5.4%) over the past year, making it difficult to compare to the Specialty Retail industry average (-3.1%).


Return on Equity

High ROE: ZZZ's Return on Equity (19.4%) is considered low.


Return on Assets

ROA vs Industry: ZZZ has a higher Return on Assets than the Specialty Retail industry average last year.


Return on Capital Employed

ROCE Improving: ZZZ's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Sleep Country Canada Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: ZZZ's short term assets (CA$100.1M) exceeds its short term liabilities (CA$95.5M)

Long Term Liabilities: ZZZ's short term assets (100.1M) do not cover its long term liabilities (490.1M)


Debt to Equity History and Analysis

Debt Level: ZZZ's debt to equity ratio (59.5%) is considered high

Reducing Debt: ZZZ's debt to equity ratio has reduced from 205.7% to 59.5% over the past 5 years.

Debt Coverage: ZZZ's debt is well covered by operating cash flow (49.9%).

Interest Coverage: ZZZ's interest payments on its debt are well covered by EBIT (8.4x coverage).


Balance Sheet

Inventory Level: ZZZ has a high level of physical assets or inventory.

Debt Coverage by Assets: ZZZ's debt is not covered by short term assets (assets are 0.6x debt).


Next Steps

Dividend

What is Sleep Country Canada Holdings's current dividend yield, its reliability and sustainability?

3.62%

Current Dividend Yield


Dividend Yield vs Market

company3.6%marketbottom25%2.0%markettop25%5.9%industryaverage3.4%forecastin3Years3.8%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: ZZZ's dividend (3.62%) is higher than the bottom 25% of dividend payers in the Canadian market (1.98%).

High Dividend: ZZZ's dividend (3.62%) is low compared to the top 25% of dividend payers in the Canadian market (5.92%).

Stable Dividend: Whilst dividend payments have been stable, ZZZ has been paying a dividend for less than 10 years.

Growing Dividend: ZZZ's dividend payments have increased, but the company has only paid a dividend for 4 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (48.8%), ZZZ's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

What is the CEO of Sleep Country Canada Holdings's salary, the management and board of directors tenure and is there insider trading?

7.8yrs

Average management tenure


CEO

Dave Friesema (52yo)

4.9yrs

Tenure

CA$1,517,734

Compensation

Mr. David Friesema also known as Dave, has been Chief Executive Officer of Sleep Country Canada Holdings Inc. since November 2014. Mr. Friesema serves as the Chief Executive Officer of Sleep Country Canada ...


CEO Compensation Analysis

Compensation vs. Market: Dave's total compensation ($USD1.16M) is about average for companies of similar size in the Canadian market ($USD1.63M).

Compensation vs Earnings: Dave's compensation has been consistent with company performance over the past year.


Management Age and Tenure

7.8yrs

Average Tenure

53.5yo

Average Age

Experienced Management: ZZZ's management team is seasoned and experienced (7.8 years average tenure).


Board Age and Tenure

4.0yrs

Average Tenure

59yo

Average Age

Experienced Board: ZZZ's board of directors are considered experienced (4 years average tenure).


Insider Trading

Insider Buying: ZZZ insiders have sold more shares than they have bought in the past 3 months.


Recent Insider Transactions

BuyCA$79906 Sep 19
David Howcroft
EntityIndividual
Role
Head of Sales
Chief Sales Officer
Shares38
Max PriceCA$21.03
BuyCA$3,28106 Sep 19
David Friesema
EntityIndividual
Role
Chief Executive Officer
CEO & Director
Shares156
Max PriceCA$21.03
BuyCA$1,32506 Sep 19
Sieg Will
EntityIndividual
Role
Chief Operating Officer
Senior Vice-President of Operations
Shares63
Max PriceCA$21.03
BuyCA$52,62523 Aug 19
Stacey Mowbray
EntityIndividual
Role
Member of the Board of Directors
Director
Shares2,500
Max PriceCA$21.05
SellCA$58,48520 Aug 19
Eric Solomon
EntityIndividual
Role
Head of Marketing
Senior Vice-President of Merchandising & Marketing
Shares2,785
Max PriceCA$21.00
BuyCA$1,30110 Jun 19
Sieg Will
EntityIndividual
Role
Chief Operating Officer
Senior Vice-President of Operations
Shares70
Max PriceCA$18.58
BuyCA$78010 Jun 19
David Howcroft
EntityIndividual
Role
Head of Sales
Chief Sales Officer
Shares42
Max PriceCA$18.58
BuyCA$3,25110 Jun 19
David Friesema
EntityIndividual
Role
Chief Executive Officer
CEO & Director
Shares175
Max PriceCA$18.58
BuyCA$21,12016 May 19
James Bradley
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,100
Max PriceCA$19.20
BuyCA$19,41709 May 19
James Bradley
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,040
Max PriceCA$18.67
SellCA$405,40020 Mar 19
Stewart Schaefer
EntityIndividual
Role
Head of Corporate Development
Chief Business Development Officer & Corporate Secretary
Shares20,000
Max PriceCA$20.27
SellCA$362,40419 Mar 19
Robert Masson
EntityIndividual
Shares18,066
Max PriceCA$20.06
SellCA$80,86218 Mar 19
Robert Masson
EntityIndividual
Shares4,009
Max PriceCA$20.17
BuyCA$24,94415 Mar 19
Zabeen Hirji-Nowaczynski
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,230
Max PriceCA$20.28
BuyCA$62,87911 Mar 19
David Howcroft
EntityIndividual
Role
Head of Sales
Chief Sales Officer
Shares3,119
Max PriceCA$20.16
BuyCA$49204 Mar 19
Robert Masson
EntityIndividual
Shares22
Max PriceCA$22.36
BuyCA$49204 Mar 19
Sieg Will
EntityIndividual
Role
Chief Operating Officer
Senior Vice-President of Operations
Shares22
Max PriceCA$22.36
BuyCA$1,02904 Mar 19
Stewart Schaefer
EntityIndividual
Role
Head of Corporate Development
Chief Business Development Officer & Corporate Secretary
Shares46
Max PriceCA$22.36
BuyCA$1,23004 Mar 19
David Friesema
EntityIndividual
Role
Chief Executive Officer
CEO & Director
Shares55
Max PriceCA$22.36
BuyCA$4,57919 Dec 18
David Howcroft
EntityIndividual
Role
Head of Sales
Chief Sales Officer
Shares217
Max PriceCA$21.10
BuyCA$581,62517 Dec 18
Sieg Will
EntityIndividual
Role
Chief Operating Officer
Senior Vice-President of Operations
Shares27,500
Max PriceCA$21.15

Ownership Breakdown


Management Team

  • Christine Magee (59yo)

    Executive Chairman

    • Tenure: 0.4yrs
    • Compensation: CA$280.72k
  • Dave Friesema (52yo)

    CEO & Director

    • Tenure: 4.9yrs
    • Compensation: CA$1.52m
  • Stewart Schaefer (54yo)

    Chief Business Development Officer & Corporate Secretary

    • Tenure: 0yrs
    • Compensation: CA$1.31m
  • Dave Howcroft (48yo)

    Chief Sales Officer

    • Tenure: 7.8yrs
    • Compensation: CA$893.04k
  • Sieg Will (53yo)

    Senior Vice-President of Operations

    • Tenure: 7.8yrs
    • Compensation: CA$723.26k
  • Eric Solomon (61yo)

    Senior Vice-President of Merchandising & Marketing

    • Tenure: 7.8yrs
  • Craig De Pratto

    Chief Financial Officer

    • Tenure: 0.08yrs
  • Prajakta Raut

    Vice President of Corporate Accounting

    • Tenure: 0yrs

Board Members

  • Christine Magee (59yo)

    Executive Chairman

    • Tenure: 0.4yrs
    • Compensation: CA$280.72k
  • John Cassaday (65yo)

    Independent Director

    • Tenure: 4.3yrs
    • Compensation: CA$100.00k
  • Doug Bradley (67yo)

    Independent Director

    • Tenure: 4.3yrs
    • Compensation: CA$100.00k
  • Andrew R. Moor (59yo)

    Independent Director

    • Tenure: 4.3yrs
    • Compensation: CA$100.00k
  • Stacey Mowbray (57yo)

    Director

    • Tenure: 0.2yrs
  • David Shaw (65yo)

    Lead Director

    • Tenure: 3.7yrs
    • Compensation: CA$100.00k
  • Dave Friesema (52yo)

    CEO & Director

    • Tenure: 4.9yrs
    • Compensation: CA$1.52m
  • Zabeen Hirji-Nowaczynski (58yo)

    Independent Director

    • Tenure: 1.2yrs
    • Compensation: CA$59.61k

Company Information

Sleep Country Canada Holdings Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Sleep Country Canada Holdings Inc.
  • Ticker: ZZZ
  • Exchange: TSX
  • Founded: 1994
  • Industry: Homefurnishing Retail
  • Sector: Retail
  • Market Cap: CA$801.391m
  • Shares outstanding: 37.15m
  • Website: https://www.sleepcountry.ca

Number of Employees


Location

  • Sleep Country Canada Holdings Inc.
  • 7920 Airport Road
  • Brampton
  • Ontario
  • L6T 4N8
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ZZZTSX (The Toronto Stock Exchange)YesCommon SharesCACADJul 2015
1S2DB (Deutsche Boerse AG)YesCommon SharesDEEURJul 2015
SCCA.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDJul 2015

Biography

Sleep Country Canada Holdings Inc., together with its subsidiaries, engages in retailing mattress and bedding related products in Canada. The company offers a range of mattresses, adjustable lifestyle base ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/23 00:31
End of Day Share Price2019/10/22 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.