Casper Sleep Beats 2Q Revenues; Shares Dip Over 10%

Casper Sleep posted a 2Q loss of $0.61 per share versus analysts’ expectations of a loss of $0.76 per share. Meanwhile, its revenues of $110.2 million also came ahead of Street estimates of $104.8 million, driven by increased e-commerce sales which offset the impact of store closures related to COVID-19 restrictions. Casper Sleep shares are down over 10%.

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Casper Sleep’s (CSPR) 2Q revenue rose 16% year-over-year, wherein its Direct-to-consumer revenues grew 5% while retail partnership revenues jumped 61.1% from the year-ago quarter. 2Q net loss of $0.61 per share also improved from year-ago loss of $2.56 per share due to higher gross margin and improvement in adjusted EBITDA.

Casper Sleep CEO Philip Krim said: “We achieved record e-commerce revenues in Q2 while making significant progress toward profitability, which is well ahead of our expectations. Our adaptable multi-channel business has allowed us to continue to meet the needs of more consumers and capture market share in a challenging environment.”

Ahead of the 2Q results, Citigroup analyst Nicholas Jones had raised the stock’s price target to $12 (25.3% upside potential) from $8 to reflect “peer multiple expansion”. He maintained a Buy rating on the stock.

Currently, the Street has a cautiously optimistic outlook on the stock. The Moderate Buy analyst consensus is based on 3 Buys and 2 Holds. The average price target of $9.10 implies downside potential of about 5%. (See CSPR stock analysis on TipRanks).