The market wants to sleep a little longer and think about whether to pull the trigger on Casper’s stock (CSPR).
Shares of the bedding and pillow maker fell as much as 10% on Tuesday after reporting what looked to be an encouraging second quarter earnings report. The stock had initially popped 5% on the news as it was clear Casper benefited from consumers upgrading their homes during COVID-19. But the stock quickly reversed course.
Co-founder and CEO Philip Krim told Yahoo Finance’s The First Trade he isn’t too sure why the stock is down on the news. But, he is pleased with the quarter.
“Not sure why the stock is doing what it is doing. We delivered a really strong second quarter. We grew our business 16% globally, and 18% in North America. Our retail partnership business was up 61% in the quarter, we were well ahead of expectations on adjusted EBITDA. So we feel like the business performed really well,” Krim said.
Here’s how Casper performed relative to Wall Street estimates for the quarter:
Net Sales: $110.2 million versus estimates for $104.8 million
Diluted Loss Per Share: 61 cents versus estimates for 76 cents
Krim reiterated his goal of being EBITDA profitable by mid-2021 in the interview. Its stock pared losses in early afternoon trading Tuesday.
“We are [still on track]. But I would say we are ahead of expectations on how we’re going to get there. So we obviously had a strong second quarter, well ahead of expectations. And so we think we are marching our way into profitability very quickly and are well-positioned to be a very dynamic company in the consumer backdrop,” Krim explained.
All in all, Casper may have some convincing to do on Wall Street following a tough IPO back in February. The stock opened for trading on Feb. 6 at $14.50 a share and closed the session around $13.50 — or a valuation of about $500 million. Prior to the IPO, Casper had been valued at $1.1 billion as a private company.
The company’s current market cap is roughly $360 million as investors wait to see if Casper could deliver on its 2021 profit goal.