MeritValue

Sonos Inc

SONOdata completeness 88%11 fiscal years on file
The thesis, from the filings

Sonos Inc earns about -1% on invested capital, below its ~9% cost of capital, and has bought back 14% of its shares over 5 years — no moat visible in the numbers. The estimate methods put fair value between $13.28 and $14.25 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$1.72B1$1.75B2$1.66B3$1.52B3$1.44B3
Net income$158.6M4$67.4M5−$10.3M6−$38.1M6−$61.1M6
Operating cash flow$253.2M7−$28.3M8$100.4M9$189.9M9$136.9M9
Capital expenditure$45.5M10$46.2M10$50.3M10$55.2M11$28.7M11
Free cash flow (derived)$207.7M7−$74.5M8$50.1M9$134.7M9$108.2M9
Total debt$012————
Cash & equivalents$640.1M13$274.9M14$220.2M15$169.7M16$174.7M16
Diluted shares140.3M137.8M127.7M123.2M120.8M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$29.42
your share of equity
Profit it earned you last year
−$5.06
Free cash flow it threw off
$8.96
Debt you’d be carrying
—

10 shares is a claim on $29.42 of net worth that earned you −$5.06 and generated $8.96 of cash last year.

iii. Is this a good business?
Moat signal · return on invested capital
-1% avg · 5y
FY21 —FY22 24%FY23 1%FY24 -8%FY25 -22%

It earned about -1% on invested capital against a ~9% cost of capital — below the cost of funding. The numbers show no moat.

seeing a moat in the numbers →
Management signal · capital allocation
−14% shares · 5y

Share count is down 14% over 5 years — management has been buying back stock, quietly handing owners a bigger slice.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 2 estimate methods that apply put fair value between $13.28 and $14.25 a share. They rest on different assumptions, so where they diverge is the story.

DCF · Growth Exit 10Y
$13.28
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth0.0%
  • fcfBase$108.2M
DCF · Growth Exit 5Y
$14.25
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth0.0%
  • fcfBase$108.2M
Earnings Power Value
not applicable
normalized (5y-median) earnings non-positive — EPV undefined
Graham Number
not applicable
diluted EPS missing or non-positive — Graham Number undefined

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years0.0%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $14.25
The three cases
Bear0.0%$14.25
Base0.0%$14.25
Bull5.0%$17.35

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 0.0%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-10-02 · accession 0000950170-23-065135 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-10-01 · accession 0001314727-24-000026 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-09-30 · accession 0001314727-25-000090 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-10-02 · accession 0000950170-23-065135 (NetIncomeLoss)
  5. 10-K · period ending 2022-10-01 · accession 0001314727-24-000026 (NetIncomeLoss)
  6. 10-K · period ending 2023-09-30 · accession 0001314727-25-000090 (NetIncomeLoss)
  7. 10-K · period ending 2021-10-02 · accession 0000950170-23-065135 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-10-01 · accession 0001314727-24-000026 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-09-30 · accession 0001314727-25-000090 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-10-02 · accession 0000950170-23-065135 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2024-09-28 · accession 0001314727-25-000090 (PaymentsToAcquireProductiveAssets)
  12. 10-K · period ending 2021-10-02 · accession 0001314727-21-000039 (LongTermDebtNoncurrent)
  13. 10-K · period ending 2021-10-02 · accession 0000950170-22-025663 (CashAndCashEquivalentsAtCarryingValue)
  14. 10-K · period ending 2022-10-01 · accession 0000950170-23-065135 (CashAndCashEquivalentsAtCarryingValue)
  15. 10-K · period ending 2023-09-30 · accession 0001314727-24-000026 (CashAndCashEquivalentsAtCarryingValue)
  16. 10-K · period ending 2024-09-28 · accession 0001314727-25-000090 (CashAndCashEquivalentsAtCarryingValue)