$2.91

-0.04 (-1.36%)

5/16/2008 4:00 PM

Select Comfort Corp. (SCSS)

CAPS Rating:

The Company's principal business is to develop, manufacture, market and support premium quality, adjustable-firmness beds and other sleep-related accessory products.

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What the Community Thinks

Total Players

3083 Outperforms

373 Underperforms

All-Stars

612 Outperforms

124 Underperforms

Wall Street

5 Outperforms

2 Underperforms

Players bullish on SCSS are also bullish on:

Players bearish on SCSS are also bearish on:

Ticker Tags

Fixtures (14), Micro Cap (4824), Home Furnishings & Fixtures (20), Minneapolis (11), Trucking (34), Minnesota (21)
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Select Comfort Corp. At A Glance

Current Price:	$2.91
Last Trade Time:	5/16/2008 4:00 PM
Open:	$3.00
Previous Close:	$2.95
Daily Range:	$2.88 - $3.00
52-Week Range:	$2.45 - $18.49
Volume:	430,396
Market Cap:	$132.44M
P/E Ratio:	13.41
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Stock Trends

SCSS VS S&P 500 (SPY)

News & Discussion Boards

Other News Headlines for SCSS

Select Comfort shares drop on 1st-quarter results miss
4/24/2008 7:33:00 PM - AP
Movers roundup: Autodesk, Stericycle
4/24/2008 3:09:00 PM - AP
Movers Roundup: Riverbed, T. Rowe Price
3/11/2008 6:47:00 PM - AP
Analyst Lifts Rating on Select Comfort
3/11/2008 6:04:00 PM - AP

More Headlines...

Top Bull Pitch

Recs

21 Select Comfort Corp. (SCSS)

Avatar dgpederson (< 20) Submitted: 11/01/07 7:55 PM

I used to be a sales professional with scss, but I left this summer after I realized that sales weren't getting any better in the near future. The problem is this. Select Comfort markets their beds to the middle class... that is why their marketing attempts have been unsuccesful. What middle income ...More

Replies: 3 | Reply | Permalink

I used to be a sales professional with scss, but I left this summer after I realized that sales weren't getting any better in the near future. The problem is this. Select Comfort markets their beds to the middle class... that is why their marketing attempts have been unsuccesful. What middle income family can justify this product? especially now. SCSS sales move with the housing market, crunch the numbers and I'm pretty sure that you will find a close correlation.

These are the steps needed to solve the problems:

Advertise when the housing market begins to turn around and when consumer spending is again on the rise. Otherwise their advertisements will fall on deaf ears. People buy a bed when they move, otherwise people can't justify spending $2,000 plus on a new bed.

When they advertise, make sure that they advertise that their beds start at $499, because they do, and you can get a really nice sleep number bed for a low price, not necessarily for $2000.

Use various internet marketing methods. The people who buy their beds are surfing around the internet because they are optimizers. they look for things that can better their lives and save them time. scss needs to put verbage on the internet on sleep in general from sleep experts and how the beds actually help.

They have a great product that 6 million people have already purchased and works wonders for people who have trouble sleeping. Select needs to hire competent and proven execs that can figure out how to market this thing. They hired a female Chief Marketing Officer today. thats a step in the right direction. This purchase is driven by females, no male wants to spend money on a new bed. She will be able to help scss if she isn't a complete idiot. After working at the sales level, I probably have more knowledge of the beds and our customers than any of our execs ever did unfortunately.

I realize this is getting long and tedious, but SCSS hasn't even moved to the coasts yet, their most mature and developed market is in Minnesota! Where the company was founded! When sales branch to the coasts the company profits will skyrocket.

Top Bear Pitch

Recs

2 Select Comfort Corp. (SCSS)

Avatar godsmacks1 (< 20) Submitted: 12/21/07 4:40 AM

home furnishings and fixture sector

mortgage problems kills furnishings

Replies: 0 | Reply | Permalink

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Recs 0 (SCSS) mdjuranovic (< 20) Submitted: 5/16/08 12:06 AM : Start Price: $3.00 SCSS Score: -2.92 I was waiting for SCSS to announce their earnings. In a word, they were awful in the short term – the company is now losing money and may end up being unprofitable over the entire year (on an earnings basis, I still think they’ll have positive cashflows). I hadn’t expected it to get this bad but if you read the earnings announcement you’ll see they’re doing all the right things. The real risk here is that when mall traffic is bad like it has been in Q1 SCSS will have a horrible quarter. Their business model is driven by people coming into their stores, seeing and trying the product, and then deciding to buy. When the first part doesn’t happen everything suffers. And in economic downturns and housing starts being down, a new-fangled mattress that’s supposed to let you sleep better is the last thing on someone’s mind. As for Sealy, Sealy doesn’t want to replicate SCSS for two reasons. One, selling a product like that requires completely new production lines and mechanisms and a sales force trained in it. Two, SCSS isn’t doing that well right now so there really isn’t too much reason to copy them. Three, and most important, a product like this would cannibalize their own sales. It would be very bad for Sealy to talk down the rigidness and non-adjustable nature of their innerspring mattresses for this new product when most likely what would happen is that they’d lose the innerspring sale and probably not gain the other sale. Then there’s the ad spending that’s needed for it and the fact that SCSS almost went bankrupt in the last downturn before it realized that it needed its own stores for the concept to be successful. All you’re seeing here is the response to the economic environment. Granted, that might last a while and might even kill the company (though I don’t think that’s likely). But when the economy does rebound this one’s going to go through the roof. Their sales will double, they’ll easily get to well over a $1 per share in EPS, and then the market will expand the P/E that it gives these shares accordingly to at least 20x b/c it will now be a growth stock. That’s where I see $20 a share at least. And I don’t think a bankruptcy is very likely even under some dire conditions. First, they’re cutting costs pretty significantly, to the tune of $15M per quarter. That alone should get them back in black. Second, they were actually cashflow positive in the quarter – they only have $44M in debt and their credit facility allows for a lot more than that: it’s a $100M credit facility that can be expanded to $175M. Also, they could also issue more equity, though considering that they bought back stock at levels that are 10x higher than right now that alone should be grounds for being fired. It strikes me that these guys just had no idea what was coming and who was really buying their product. Apparently, home remodelilngs etc… were a larger part of their business than they thought. And they also didn’t think that mall traffic would go down so much. To top it off, they’re stil searching for a sure-fire way to expand their brand and I’m sure that in this economy it’s hard to know what’s working and what’s not. I think they’ve finally realized that things are serious and they’re switching to survival mode; cutting staff, slowing store expansion and remodelings, and lowering ad spending. Which is good; I was never convinced that there were THAT many opportunities for their store locations anyway. They’ll probably look to expand brand presence via the wholesale route. I don’t think the market is pricing in a bankruptcy; I think the market is being somewhat realistic that this is a company with no book value. All its value derives from future profits. And those are in question; the days when the company used to make $50M a year in earnings may very well have been an aberration but I doubt it very much. Even if the most they can ever manage in good economic times is $30M that means you’re getting the company at about 4x earnings now. A true Buffett play! Now, I can understand that for a lot of people this seems like a fad so they’re discounting the earnings heavily but I disagree – this is a legitimate product that is actually priced attractively for what it is and the level of comfort it provides. And it’s something that’s been selling, profitably, from well over a decade now. I’m more afraid of a private equity shop coming in and buying out the whole thing at $5. If I had $250M around, I’d do it. You could cut out all the costs of being a public company, you could forget quick-fix advertising solutions, scale back on stores, and focus on cash generation and building out the wholesale program. Report this Post Replies: 0 \| Reply \| Permalink Oops! There appears to be a problem with your comment. Check to see if there's something you left out. Recs 0 (SCSS) pjani06 (38.63) Submitted: 5/13/08 9:18 PM : Start Price: $2.95 SCSS Score: -2.53 Wayy too cheap at these levels. Cannot go any lower as any concerns for bankruptcy aren't warranted with current financials & news Report this Post Replies: 0 \| Reply \| Permalink Oops! There appears to be a problem with your comment. Check to see if there's something you left out. Recs 0 (SCSS) jtallenmd (31.51) Submitted: 5/12/08 12:51 PM : Start Price: $2.82 SCSS Score: -1.31 I am picking this as an underperform simply because I have not had much luck picking stocks in either CAPS or my real portfolio recently. I am long SCSS in real life (and way under water). I figure if I pick it as "underperform" here either my portfolio will improve or it won't hurt so much when SCSS continues to tank. Report this Post Replies: 0 \| Reply \| Permalink Oops! There appears to be a problem with your comment. Check to see if there's something you left out. Recs 0 (SCSS) boomho603 (29.05) Submitted: 5/10/08 8:59 AM : Start Price: $2.90 SCSS Score: -2.10 cheap money and they are fixing the glitch. Report this Post Replies: 0 \| Reply \| Permalink Oops! There appears to be a problem with your comment. Check to see if there's something you left out. Recs 0 (SCSS) cursed1 (98.56) Submitted: 5/07/08 12:26 PM : Start Price: $3.11 SCSS Score: 9.46 Select Comfort Corporation is engaged primarily in developing, manufacturing, marketing and distributing adjustable-firmness beds and other sleep-related accessory products. The air-chamber technology of the Company's Sleep Number bed allows adjustable firmness on each side of the mattress. In addition, Select Comfort markets and sells accessories and other sleep related products, which focus on providing personalized comfort to complement the Sleep Number bed and provide a better night’s sleep to the consumer. In my opinion, Sleep Number beds are typically on the upper end of what consumers are willing to pay for a mattress. With slowing economic times, this is one of the first things I would cut back on when shopping for a mattress. Report this Post Replies: 0 \| Reply \| Permalink Oops! There appears to be a problem with your comment. Check to see if there's something you left out.
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