Dec. 11, 2013, 7:03 AM
- Demand for guns in the U.S. is in a downward swing as it appears more likely that Congress won't enact legislation to ban semiautomatic rifles.
- In November, federal background checks on potential gun purchasers were 10% lower Y/Y.
- Despite sales trends which are starting to slow, manufacturers and retailers have seen more women become buyers.
- Sector watch: SWHC earnings
- Related stocks: RGR, SWHC, CAB
Dec. 10, 2013, 5:42 PM
Dec. 10, 2013, 4:39 PM
- Smith & Wesson (SWHC) shares jump 5.8% after the company cleaned out expectations in FQ2 and issued higher-than-expected FQ3 guidance.
- Net sales of $139.3M were up 2% Y/Y; excluding Walther products (under a distribution agreement that ended in April), revenue grew 9.2% Y/Y, driven by a 27.4% Y/Y spike in handgun sales.
- Gross margin represented a 510bp expansion to 41.6%, building on the trend in FQ1. The company cited favorable product mix, absorption, and manufacturing efficiencies, as well as absence of lower-margin Walther sales.
- Opex jumped to 20.9% of sales, or $29.2M, from 16% of sales, or $21.8M, in FQ2 2012; excluding one-time ERP system expenses, opex would have come in at 18.2% of sales, or $25.3M.
- Income from continuing operations was $17.1M ($0.28/share) vs. $16.4M ($0.24/share) in Q2 2012.
- Management sees revenue in FQ3 of $140M-$145M (well above analyst consensus of $137.4M) and EPS of $0.28-$0.30 (vs. $0.27). It reiterates FY2014 guidance for sales of $610M-$620M (vs. $617M) and EPS of $1.30-$1.35 (vs. $1.32).
- Conference call at 5pm ET, PR
Dec. 10, 2013, 4:09 PM
Dec. 10, 2013, 12:10 AM
Dec. 9, 2013, 5:35 PM
Dec. 5, 2013, 10:04 AM
- Smith & Wesson (SWHC +4.2%) jumps after Lake Street upgrades shares to Buy from Hold and raises its PT to $17 from $12.
- The firm thinks downside risk is low going into next week's earnings report and that an in-line performance would be a catalyst for shares. Analysts expect EPS of $0.21 on revenue of $137.5M (+0.7% Y/Y).
Oct. 8, 2013, 10:03 AM
- The Taser (TASR +5.5%) price cut is not as bad as it seems, says JPMorgan's Paul Coster, who took the time to listen on the company conference call.
- It's more a debundling of its Axon/Evidence.com service as total solution pricing has not changed - the company now charges for the first year of evidence.com storage and license fees. The new strategy is intended to eliminate customized sales contracts, thus accelerating the sales cycle.
- Coster ups his price target to $13 from $12, but keeps the stock rated a Hold.
- Related: RGR +1.4%, SWHC +1.1%.
- Previous: The price cut story.
Sep. 17, 2013, 2:51 PM
- Sturm Ruger (RGR +2.4%), Cabela's (CAB +1.5%), and Smith & Wesson (SWHC +2.7%) trade higher after the stocks fell back in response to a mass shooting at the Washington D.C. Navy Yard yesterday.
- Some early reaction to the tragedy is focused on the suspect's history of mental illness, although calls for stricter gun control laws are also part of the debate.
- A broader theme in the weapons manufacturing sector is the trend toward slowing demand. Earlier this month, Smith & Wesson issued guidance for Q3 revenue which fell below the consensus estimate of analysts.
Sep. 6, 2013, 12:45 PM
Sep. 6, 2013, 11:26 AM
- Dougherty is out defending Buy-rated Smith & Wesson (SWHC -8.4%) which is in the midst of a post-earnings swoon thanks to what many are viewing as disappointing guidance.
- "The way we see it, handgun ownership and sport shooting are growing in popularity in accordance with demographic trends," analyst Andrea James says.
- "Any stock weakness tied to the Q2 guide should be treated as an opportunity," she concludes.
- Price target is $14.
Sep. 6, 2013, 9:10 AM
Sep. 5, 2013, 7:06 PM
- Smith & Wesson Holding (SWHC) FQ1 beats estimates across the board.
- Net profit jumped 49% Y/Y as the gun maker reported sharply higher sales.
- Gross margin widened to 42.6% from 37.7%.
- For the current quarter, the company sees per-share earnings from continuing operations between $0.20 to $0.22 on net sales of $135M to $140M, below analysts estimates for $0.29 and $143M in revenue.
- Shares -5% AH.
Sep. 5, 2013, 5:39 PM
Sep. 5, 2013, 4:12 PM
Sep. 5, 2013, 12:44 PM| Sep. 5, 2013, 12:44 PM | 3 Comments
Smith & Wesson Holding Corp manufactures firearms. It manufactures handguns, modern sporting rifles, hunting rifles, black powder firearms, handcuffs, and firearm-related products and accessories.
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