initial public offerings (IPOs) trading on American exchanges

Thursday, February 6, 2020

Casper Sleep (CSPR) began trading on the NYSE on Thur 6 Feb 20

Casper Sleep Inc. offers a range of Casper mattresses, pillows, sheets and duvets, bedroom furniture and accessories, sleep technology, and related services through its e-commerce platform, 60 Casper retail stores, and 18 retail partners.
The company was formerly known as Providence Mattress Company and changed its name to Casper Sleep Inc. in January 2014.
  • Sector: Consumer Cyclical
  • Industry: Furnishings, Fixtures & Appliances
  • Full Time Employees: 597
  • Incorporated in 2013 
  • Headquartered in New York, New York
Casper Sleep opened at $14.50 after pricing IPO at $12, the low end of the $12-13 range that was expected.
CSPR finished the trading day at $13.50 after rising as high at $15.85.

Philip Krim, co-founder and CEO of mattress company, Casper, holds his son as he prepares to celebrate the companies IPO on the floor of the New York Stock Exchange shortly after the opening bell in New York, U.S., February 6, 2020. REUTERS/Lucas Jackson

2nd day of trading

Philip Krim, CEO and co-founder of sleep product company Casper, right, is applauded as he rings the New York Stock Exchange opening bell, before their IPO, Thursday, Feb. 6, 2020.

Co-founders of Casper: Luke Sherwin, Gabe Flateman, CEO Philip Krim, Jeff Chapin and Neil Parikh.

Philip Krim, CEO and co-founder
  • Casper estimated that the global sleep economy was worth about $432 billion last year.
  • One potential investor who went into the company’s Thursday presentation at the St. Regis hotel in Midtown said he decided to pass on Casper after hearing executives like Chief Executive Philip Krim talk about their planned expansion to brick-and-mortar shops. “It doesn’t make sense,” the investor said on his way out. “Isn’t the whole thesis about being a disruptor?”
  • Casper lost $67 million during the first nine months of last year on $312 million in revenue, and was on track to lose more for the full year than in 2018, according to Casper’s public filing.
Casper once occupied the same strata as other “unicorns,” or startups valued above $1 billion, but is now closer to $600 million. The IPO’s reception is an effective temperature read for other Silicon Valley hopefuls like Airbnb that may also go public this year.

According to its regulatory filing, Casper is hoping to raise just under $125 million with its IPO, and hopes to capitalize on the growing emphasis on health and wellness — estimating the “global sleep economy” is worth about $432 billion. Last year, the company raised over $300 million from a list of big name investors, including actor Leonardo DiCaprio, rapper 50 Cent and retail giant Target (TGT).

Casper retail store

However, investors have laid siege to a wide range of companies with lofty visions and valuations — but no actual profits. Casper reported $312.3 million in revenue in the first nine months of last year, but lost over $67 million as it expanded its retail footprint, and spent lavishly on marketing to fend off challenges from competitors like Sleep Number (SNBR).

The long and growing list of newly-minted public companies that have tumbled sharply since their debuts include Uber (UBER), Lyft (LYFT) , Peloton (PTON) and Slack (WORK). All of those stocks crashed in their market debuts, and continued to slide afterward.

Meanwhile, the debacle of WeWork’s aborted IPO is still fresh in the minds of chastened investors.

The mattresses range in price from $695 for a twin to $3,495 for the king size of its most advanced mattress, the hybrid wave. Casper also has 20 retail stores around the country and says it has plans for 200 more. With retail partners including Costco, Nordstrom, Target, as well as American Airlines, its mattresses, pillows, bed frames and accessories are available at more than 1,500 retail destinations nationwide. Its latest product — Glow — is what the company calls a “magical light for better sleep.”
Casper box

The foam mattresses are made by Leggett & Platt, a Missouri-based bed-parts behemoth with $4.65 billion in revenue. Leggett also makes bed parts for several Casper competitors, including bed-in-a-box mattresses for Leesa, a privately owned mattress startup, and Serta Simmons’ Tuft & Needle, according to sources.

Leggett also makes springs for Sealy, Serta and Simmons — all of which are far bigger clients.

There are other manufacturers that make foam: Carpenter, Future Foam and Innocor Foam Technologies. Still, the relatively small pool is a sign that Casper may struggle to cut its manufacturing costs in the future.

The mattress space becomes increasingly crowded with deep-pocketed competitors like Walmart, Amazon and Ikea.

Casper lost $67 million during the first nine months of last year on $312 million in revenue, and was on track to lose more for the full year than in 2018, according to Casper’s public filing.

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