Sonos Inc (NASDAQ: SONO)

Sector: Technology Industry: Consumer Electronics CIK: 0001314727
Market Cap 1.83 Bn
P/B 4.12
P/E -104.00
P/S 1.27
ROIC (Qtr) 0.38
Div Yield % 0.00
Rev 1y % (Qtr) -0.94
Total Debt (Qtr) 52.10 Mn
Debt/Equity (Qtr) 0.12
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About

Sonos Inc, with its ticker symbol SONO, operates in the audio equipment industry, where it has revolutionized the way people listen to music and other audio content. The company was established in 2

Investment thesis

Bull case

  • Strong operating cash flow of 144M provides robust 2.76x coverage of total debt 52.10M, indicating excellent debt servicing capability and financial flexibility.
  • Strong tangible asset base of 794.09M provides 15.24x coverage of total debt 52.10M, indicating robust asset backing and low credit risk.
  • Operating cash flow of 144M provides exceptional 305.74x coverage of interest expenses 471000, showing strong debt service capability.
  • Robust free cash flow of 122.47M exceeds capital expenditure of 21.53M by 5.69x, indicating strong organic growth funding capability.
  • Tangible assets of 794.09M provide exceptional 9.51x coverage of deferred revenue 83.54M, showing strong service capability backing.

Bear case

  • Operating cash flow of 144M barely covers its investment activities of (24.25M), with a coverage ratio of -5.94, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (24.25M) provide weak support for R&D spending of 258.89M, which is -0.09x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • The company's operating cash flow of 144M shows concerning coverage of stock compensation expenses of 71.42M, with a 2.02 ratio indicating potential earnings quality issues.
  • Free cash flow of 122.47M represents just -157.02x of debt issuance (780000), suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • Operating earnings of 8.23M show weak coverage of depreciation charges of 58.73M, with a 0.14 ratio indicating high capital intensity and potential reinvestment needs.

Geographical Breakdown of Revenue (2025)

Product and Service Breakdown of Revenue (2025)

Peer comparison

Companies in the Consumer Electronics
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 AAPL Apple Inc. 6,723.18 Bn 479.78 103.08 90.51 Bn
2 SONY Sony Group Corp 132.91 Bn -97.61 1.71 12.46 Bn
3 LPL LG Display Co., Ltd. 4.03 Bn 25.65 0.22 8.83 Bn
4 SONO Sonos Inc 1.83 Bn -104.00 1.27 0.05 Bn
5 ZEPP Zepp Health Corp 0.37 Bn -5.62 1.59 0.21 Bn
6 TBCH Turtle Beach Corp 0.23 Bn 12.65 0.67 0.09 Bn
7 VUZI Vuzix Corp 0.21 Bn -5.50 38.67 0.00 Bn
8 GPRO GoPro, Inc. 0.13 Bn -1.07 0.20 0.20 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.80 1.78
EV to Cash from Ops. EV/CFO 11.86 -1.62
EV to Debt EV to Debt 32.77 107.90
EV to EBIT EV/EBIT 207.52 27.25
EV to EBITDA EV/EBITDA 28.18 19.36
EV to Free Cash Flow [EV/FCF] EV/FCF 13.94 69.87
EV to Market Cap EV to Market Cap 0.93 5.36
EV to Revenue EV/Rev 1.19 8.17
Price to Book Value [P/B] P/B 4.12 9.46
Price to Earnings [P/E] P/E -104.00 14.96
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 -85.07
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 -0.94
Dividend per Basic Share Div per Share (Qtr) 0.00 0.06
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 0.69
Interest Coverage Int. cover (Qtr) 17.47 -38.56
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 65.43 -25,921.15
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 11.63 51.04
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 -3.99
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 72.75 -97.56
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 381.32 -124.49
EBIT Growth (1y) % EBIT 1y % (Qtr) 110.85 -56.87
EBT Growth (1y) % EBT 1y % (Qtr) 110.17 23.23
EPS Growth (1y) % EPS 1y % (Qtr) 72.73 -15.88
FCF Growth (1y) % FCF 1y % (Qtr) 1,357.69 -2,155.24
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -0.85 -2.16
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.52 0.76
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.01
Cash Ratio Cash Ratio (Qtr) 0.81 0.99
Current Ratio Curr Ratio (Qtr) 1.65 3.14
Debt to Equity Ratio Debt/Equity (Qtr) 0.12 3.77
Interest Cover Ratio Int Coverage (Qtr) 17.47 -38.56
Times Interest Earned Times Interest Earned (Qtr) 17.47 -38.56
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 4.70 -158.21
EBIT Margin % EBIT Margin % (Qtr) 0.57 240.24
EBT Margin % EBT Margin % (Qtr) 0.54 -170.49
Gross Margin % Gross Margin % (Qtr) 44.70 19.30
Net Profit Margin % Net Margin % (Qtr) -1.20 -171.80