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Sunday, July 3, 2022

Summer Infant, Inc. (SUMR) stock surged in the Current Market; here is why?

Summer Infant, Inc. (SUMR) stock gained in the current market after announcing its fourth quarter and fiscal 2021 results and its acquisition by Kids2. SUMR’s stock price is $11.40, gaining more than 28% compared to yesterday’s closing price. SUMR stock closed at $8.89 at the end of the last trading session. The stock volume traded in the previous trading session was around 5.48K shares. The current market cap of the company is about $24.52 million.


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SUMR Acquired by Kids2

Summer Infant, Inc. (SUMR) announced today that it had inked a deal to be acquired by Kids2, Inc., a worldwide business that offers early-stage parents and families solutions. Investors would receive $12.00 in cash for each share of common stock owned, a 41.2 percent premium over the company’s closing price on March 15, 2022. The Company’s Board of Directors unanimously authorized the deal, and Wynnefield Capital and Jason Macari, essential stakeholders, signed voting agreements supporting it. The deal is scheduled to finalize in Q2 2022.

SUMR: Q4 and Fiscal 2021 Key Financials

  • Summer Infant, Inc.’s Q4 2021 revenue was $35.3 million, which was somewhat lower than the $36.04 million in Q4 2020 sales.
  • Compared to fiscal 2020, fiscal 2021 revenue was $143.6 million, down from $155.2 million the previous year.
  • Net loss for SUMR in the fourth quarter of 2021 was roughly $4.8 million, higher than the net loss for the fourth quarter of 2020 of $3.3 million.
  • In fiscal 2021, SUMR’s net loss was roughly $2.8 million, and profitability dropped significantly compared to the net loss of $1 million in fiscal 2020.
  • Per-share losses in Q4 2021 were $2.20, whereas losses in Q4 2020 totaled $1.59.
  • Fiscal 2021 had a $1.35 loss per share compared to fiscal 2020s $0.52 loss per share.

SUMR CEO’s Remarks on Financial Results

According to CEO Stuart Noyes, supply chain disruptions and rising material prices hampered our ability to satisfy demand and preserve profitability. We had hoped for better circumstances, but they have not materialized. Container rates, demurrage, and logistical costs have increased in recent years, making it challenging to manage supplies effectively. Working capital has been squeezed by higher inventory and longer transport times.

SUMR: What Next?

According to the CEO, there is a high demand for several of its items. At the moment, they have agreed to sell SUMR to Kids2 in order to unlock value for stockholders. The company will be able to secure the long-term viability of its successful and innovative goods in a competitive market with an unstable supply chain environment.

Conclusion

Despite its bad financial numbers, Summer Infant, Inc. (SUMR) gained in the current market. However, one thing that made it surge in today’s current market is its acquisition by Kids2. It will have a significant effect on its revenue and market share.

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