The Bedding Boom is a Dream for Mattress Makers
Americans spend more than seven hours asleep each night on average. Work-from-home trends have caused a spike in demand for sleep-related products – particularly adjustable beds – creating a boom of sorts. As a result, the global home bedding market is expected to expand at a compound annual growth rate of 9% from 2021 to 2028 to reach $147.09 billion.
New innovations in materials and the incorporation of sleep-related technology (smart beds with apps are fairly common now) have manufacturers and retailers sparring to reach consumers looking for that perfect night’s sleep. With the industry heating up, here are some of the sleep product providers that stand to benefit from the bedding boom.
Tempur Sealy International Inc. (Tii:TPX)
A comfortable mattress is a must for quality sleep. Tempur Sealy, which touts its Sealy brand as America’s best-selling mattress, focuses on high-end mattresses and other bedding products. The Kentucky-based bedding company recently announced it expanded its mattress portfolio that includes new Sealy mattresses with technologies that provide enhanced support, durability and cool-to-the-touch covers. Tempur Sealy’s shares are up 46% year-to-date and more than 350% for the trailing 12 months.
Sleep Number Corp. (Tii:SNBR)
A leading manufacturer of bedding products under the Sleep Number and Comfortaire brands, Sleep Number Corp. benefits from high levels of demand for its smart beds and related products. The company reported record 2020 results with net sales increasing 9% to $1.86 billion, including a 6% comparable sales gain. The bedding and accessories manufacturer projected full-year 2021 earnings per diluted share to grow 30% (excluding the impact of the 53rd week). Rather than relying mainly on third-party retailers, Sleep Number Corp. sells directly to consumers through 79 company-owned brick-and-mortar locations, direct marketing operations and online through its branded website.
Casper Sleep Inc. (Tii:CSPR)
Though one of the newer players in the industry, Casper’s mission is to become the largest and most loved sleep company. Founded in 2014, the company offers 40 products through its e-commerce platform, 20 retail partners, and 67 retail stores. Casper, who manufactures its mattresses in Georgia and Pennsylvania, posted the best revenues in its history last February. Revenue increased 18.4% to a record $150.3 million on a quarterly basis and by 13.1% to a record $497 million for the year. Though improved over the year-ago period, Casper still reported a net loss, $15 million on a quarterly basis, a 3.7% improvement. Demand remained strong in North America, which resulted in 17.4% revenue growth in the region for the full year 2020.
No matter what else is happening in the world, everyone needs quality sleep. Though the bedding boom will eventually wane over time, expect these brands (along with the dearth of bedding-related startups that have entered the scene) to continue to duke it out over market share.