Sonos (NasdaqGS:SONO) - Share price, News & Analysis

SONO fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	5/6
Past Performance	4/6
Financial Health	6/6
Dividends	0/6

SONO Stock Overview

Sonos, Inc., together with its subsidiaries, designs, develops, manufactures, and sells multi-room audio products in the Americas, Europe, the Middle East, Africa, and the Asia Pacific.

Rewards

Trading at 75.9% below our estimate of its fair value

Earnings are forecast to grow 23.99% per year

Earnings have grown 72.3% per year over the past 5 years

Risk Analysis

Shareholders have been diluted in the past year

Sonos Competitors

Sony Group

NYSE:SONY

US$109.2b

VIZIO Holding

NYSE:VZIO

US$1.6b

Snap One Holdings

NasdaqGS:SNPO

US$879.4m

VOXX International

NasdaqGS:VOXX

US$186.0m

Price History & Performance

Summary of all time highs, changes and price drops for Sonos
Historical stock prices
Current Share Price	US$19.95
52 Week High	US$42.57
52 Week Low	US$18.92
Beta	1.86
1 Month Change	-17.83%
3 Month Change	-26.47%
1 Year Change	-45.37%
3 Year Change	95.02%
5 Year Change	n/a
Change since IPO	0.20%

Recent News & Updates

May 25

Sonos: Managing Deftly Through A Tight Environment

Shares of Sonos have slumped all year long, dropping 30% since the start of January. Though demand continues to be robust, the company has faced gross margin challenges owing to constrained components and higher freight costs. Management has been able to partially offset these global cost increases, however, with opex rationalization. The company continues to trade at attractive multiples of adjusted EBITDA.

Shareholder Returns

	SONO	US Consumer Durables	US Market
7D	-0.1%	1.1%	1.0%
1Y	-45.4%	-23.7%	-15.1%

Return vs Industry: SONO underperformed the US Consumer Durables industry which returned -31.7% over the past year.

Return vs Market: SONO underperformed the US Market which returned -13.2% over the past year.

Price Volatility

Is SONO's price volatile compared to industry and market?
SONO volatility
SONO Average Weekly Movement	10.2%
Consumer Durables Industry Average Movement	7.7%
Market Average Movement	7.8%
10% most volatile stocks in US Market	16.8%
10% least volatile stocks in US Market	2.9%

Stable Share Price: SONO is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 10% a week.

Volatility Over Time: SONO's weekly volatility (10%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
2002	1,525	Patrick Spence	https://www.sonos.com

Sonos, Inc., together with its subsidiaries, designs, develops, manufactures, and sells multi-room audio products in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company provides wireless speakers, home theater speakers, components, and accessories. It offers its products through approximately 10,000 third-party retail stores, including custom installers of home audio systems; and e-commerce retailers, as well as through its Website sonos.com.

Sonos Fundamentals Summary

How do Sonos's earnings and revenue compare to its market cap?
SONO fundamental statistics
Market Cap	US$2.55b
Earnings (TTM)	US$141.13m
Revenue (TTM)	US$1.80b

18.1x

P/E Ratio

1.4x

P/S Ratio

Is SONO overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
SONO income statement (TTM)
Revenue	US$1.80b
Cost of Revenue	US$961.26m
Gross Profit	US$841.21m
Other Expenses	US$700.08m
Earnings	US$141.13m

Last Reported Earnings

Apr 02, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	1.10
Gross Margin	46.67%
Net Profit Margin	7.83%
Debt/Equity Ratio	0%

How did SONO perform over the long term?

See historical performance and comparison

Valuation

Is Sonos undervalued compared to its fair value and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

>50%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: SONO ($19.95) is trading below our estimate of fair value ($82.63)

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

Price To Earnings Ratio

PE vs Industry: SONO is poor value based on its Price-To-Earnings Ratio (18.1x) compared to the US Consumer Durables industry average (7.7x).

PE vs Market: SONO is poor value based on its Price-To-Earnings Ratio (18.1x) compared to the US market (14.9x).

Price to Earnings Growth Ratio

PEG Ratio: SONO is good value based on its PEG Ratio (0.8x)

Price to Book Ratio

PB vs Industry: SONO is overvalued based on its Price-To-Book Ratio (3.8x) compared to the US Consumer Durables industry average (1.2x).

Future Growth

How is Sonos forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

Future Growth Score

5/6

Future Growth Score 5/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

24.0%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: SONO's forecast earnings growth (24% per year) is above the savings rate (1.9%).

Earnings vs Market: SONO's earnings (24% per year) are forecast to grow faster than the US market (12.1% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: SONO's revenue (10.8% per year) is forecast to grow faster than the US market (7.7% per year).

High Growth Revenue: SONO's revenue (10.8% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: SONO's Return on Equity is forecast to be high in 3 years time (36.4%)

Past Performance

How has Sonos performed over the past 5 years?

Past Performance Score

4/6

Past Performance Score 4/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

72.3%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: SONO has high quality earnings.

Growing Profit Margin: SONO's current net profit margins (7.8%) are higher than last year (7%).

Past Earnings Growth Analysis

Earnings Trend: SONO has become profitable over the past 5 years, growing earnings by 72.3% per year.

Accelerating Growth: SONO's earnings growth over the past year (28.1%) is below its 5-year average (72.3% per year).

Earnings vs Industry: SONO earnings growth over the past year (28.1%) underperformed the Consumer Durables industry 45.1%.

Return on Equity

High ROE: SONO's Return on Equity (21%) is considered high.

Financial Health

How is Sonos's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: SONO's short term assets ($1.0B) exceed its short term liabilities ($463.7M).

Long Term Liabilities: SONO's short term assets ($1.0B) exceed its long term liabilities ($90.8M).

Debt to Equity History and Analysis

Debt Level: SONO is debt free.

Reducing Debt: SONO has no debt compared to 5 years ago when its debt to equity ratio was 42.2%.

Debt Coverage: SONO has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: SONO has no debt, therefore coverage of interest payments is not a concern.

Balance Sheet

Dividend

What is Sonos's current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate SONO's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate SONO's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if SONO's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if SONO's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as SONO has not reported any payouts.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

5.0yrs

Average management tenure

CEO

Patrick Spence (46 yo)

5.83yrs

Tenure

US$5,482,555

Compensation

Mr. Patrick Spence has been Chief Executive Officer and Director at Sonos, Inc. since January 2017 and has been its President since July 2016. He served as Managing Director of Global Sales & Regional Mark...

CEO Compensation Analysis

Compensation vs Market: Patrick's total compensation ($USD5.48M) is about average for companies of similar size in the US market ($USD6.91M).

Compensation vs Earnings: Patrick's compensation has increased by more than 20% in the past year.

Leadership Team

Experienced Management: SONO's management team is seasoned and experienced (5 years average tenure).

Board Members

Experienced Board: SONO's board of directors are considered experienced (5 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 2.6%.

Data	Last Updated (UTC time)
Company Analysis	2022/05/25 00:00
End of Day Share Price	2022/05/25 00:00
Earnings	2022/04/02
Annual Earnings	2021/10/02