Sleep Number (NASDAQ: SNBR) and Hooker Furniture (NASDAQ:HOFT) are both small-cap consumer discretionary companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, earnings, valuation, institutional ownership, profitability, risk and analyst recommendations.

Volatility & Risk

Sleep Number has a beta of 0.61, suggesting that its stock price is 39% less volatile than the S&P 500. Comparatively, Hooker Furniture has a beta of 0.64, suggesting that its stock price is 36% less volatile than the S&P 500.

Institutional and Insider Ownership

85.1% of Hooker Furniture shares are held by institutional investors. 4.0% of Sleep Number shares are held by insiders. Comparatively, 2.9% of Hooker Furniture shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Sleep Number and Hooker Furniture, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sleep Number 1 3 3 0 2.29
Hooker Furniture 0 0 0 0 N/A

Sleep Number currently has a consensus price target of $33.40, indicating a potential downside of 11.22%. Given Sleep Number’s higher possible upside, equities research analysts plainly believe Sleep Number is more favorable than Hooker Furniture.

Earnings and Valuation

This table compares Sleep Number and Hooker Furniture’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Sleep Number $1.31 billion 1.14 $51.41 million $1.41 26.68
Hooker Furniture $577.22 million 0.87 $25.28 million $2.64 16.19

Sleep Number has higher revenue and earnings than Hooker Furniture. Hooker Furniture is trading at a lower price-to-earnings ratio than Sleep Number, indicating that it is currently the more affordable of the two stocks.

Dividends

Hooker Furniture pays an annual dividend of $0.56 per share and has a dividend yield of 1.3%. Sleep Number does not pay a dividend. Hooker Furniture pays out 21.2% of its earnings in the form of a dividend.

Profitability

This table compares Sleep Number and Hooker Furniture’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Sleep Number 4.34% 51.12% 14.26%
Hooker Furniture 4.96% 14.89% 9.63%

Summary

Sleep Number beats Hooker Furniture on 10 of the 15 factors compared between the two stocks.

About Sleep Number

Sleep Number Corporation, formerly Select Comfort Corporation, is a designer, manufacturer, marketer, retailer and servicer of a line of Sleep Number beds. The Company offers consumers individualized sleep solutions and services, which include a complete line of Sleep Number beds, bases and bedding accessories. Its Sleep Number bed offers SleepIQ technology sensors that work directly with the bed’s DualAir technology to track each individual’s sleep. The Sleep Number bedding collection comprises a line of sleep products that are designed to solve sleep issues. It offers FlextFit adjustable bases, and Sleep Number pillows, sheets and other bedding products. It offers Sleep Number beds in ranges within the mattress category, and in a range of sizes, including twin, full, queen, eastern king and California king. It also offers an assortment of temperature-balancing products.

About Hooker Furniture

Hooker Furniture Corporation is a home furnishings marketing, design and logistics company offering sourcing of residential casegoods and upholstery, as well as domestically-produced leather and fabric-upholstered furniture. The Company operates through three segments: casegoods furniture, upholstered furniture and all other. The Company’s casegoods product categories include accents, home office, dining, bedroom and home entertainment furniture under the Hooker Furniture brand. Its residential upholstered seating companies include Bradington-Young, which is engaged in upscale motion and stationary leather furniture, and Sam Moore Furniture, which is engaged in upscale occasional chairs, settees, sofas and sectional seating with a focus on cover-to-frame customization. It also markets a line of imported leather upholstery under the Hooker Upholstery trade name. All other segment operates under the H Contract and Homeware brands.

Receive News & Ratings for Sleep Number Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Sleep Number and related companies with MarketBeat.com's FREE daily email newsletter.