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  • Smith & Wesson Earnings Will Surprise  [View article]
    Smith & Wesson Firearms Continue To Fly Off The Shelves, No Sales Drop In Sight! [Edit or Delete]0 comments
    Jun 2, 2013 5:33 PM | about stocks: SWHC, RGR, DIA, QQQ, SPY, DJG, OLN, DKS, BGFV, CLWR, BYD
    First hand experience from California regarding Smith & Wesson (SWHC)

    Just got back from my local Turners Outdoorsman store around L.A it is 5 times the size of Dicks Sporting Goods (DKS) and about half the size of Big 5 Sporting Goods (BGFV). After hearing about the new laws the Democrats in CA. are working to pass in the State capital, I figured it was time to take advantage of the new ad Turners just released. The Smith & Wesson MP15 .223 caliber California compliant, bullet button. One of the new laws they want to pass is elimination of the bullet button and detachable magazines, with future sales being illegal. Read some of the laws that are being proposed most of which will never pass legal mustard since they infringe on the 2nd Amendment. However most likely the more conservative state Assembly will not follow suit with the very liberal state Senate only passing a few less extreme measures.

    Why would I purchase this? I want to take up long range target shooting and the air rifle I currently use doesn't allow for range shooting. Pistol shooting is fun but less challenging. Who knows maybe I can make the Olympics? Not with my aging eyes.

    So I got down there and of course almost no ammo, no .45,.38 303 and .223, available for purchase. Everything seems to be sold out the day it comes in according to staff even with a limit on the number of rounds a customer may purchase. The store is getting it from anywhere they can find it, but it is difficult to find.

    Turners was listing the M&P15 for $899 above the $839 MSRP S&W has on their website. I was number 35 and they were serving number 28. As I waited I saw 2 S&W M&P rifles sell and another higher priced brand with a sight attached. Since they had a limited amount of pistols due to continued demand and these new laws, I assume most of the 15 or so people behind me were also planning on purchasing a rifle. When I was called I checked out the M&P15 and told Ray I would take it.

    Now was my chance to fish for information of the demand for Smith & Wesson products. First I asked how many they had gotten in stock? Ray told me 250 arrived on Thursday evening. Turners has 15 stores located around Southern California. Demand can not keep them in stock so this was a larger order, they normally order in 150 lots. Turners buys guns in 150 lots according to Ray. I asked how many were left? Ray checked the computer and said they had about 80 left. It was only 10:50am on Sat. morning.
    Then I asked about background checks in the last month. He said they had dropped a little from the Dec./Jan peak, but it was still above what they were doing in 2012. So no real drop off.
    Then after I looked in the case I saw mostly just .22 calibers handgun some Glock pistols in different models, about 9 revolvers, a Springfield Armory pistol, a few other 9 millimeters and 1 longer barrel S&W M&P45 pistol. Almost everything was still sold out.
    After completing the paperwork and paying, I reminded Ray that I wanted to buy .223 ammo. He must have forgotten to check because he began searching the store. Finally he came out of the back with 2 boxes in a bag and walked them up to the register. He told me he put them aside for someone who didn't show up at the time he told him to pick them up.

    I asked Ray once again about the S&W handguns and he said that the one I saw in the case was the only pistol they had left, a display model and the others in the back room were already sold. There is a 10 day waiting period in CA to pick up firearms after purchase.
    He said everything that comes in sells out immediately. Remember this now, THERE IS NO SLOW DOWN!!!

    Guns continue to fly off the shelves and everything S&W makes is selling out immediately. THEY CAN'T EVEN RESTOCK THE SHELVES! Restocking every gun store in the nation will take years according to Ray, due to continued demand. This is 6 months after the shooting tragedy and 3 months after analysts predicted that sales would drop off. The NICS numbers, which are the FBI background check numbers continue to be way above last years increasing numbers. This means there are millions of gun buyers waiting in the wings to purchase a firearm that is currently available or may arrive in the future.

    The demand is not slowing down for S&W for at least the next several years. The new CA. gun laws being proposed are creating further demand and according to Turners the new laws if passed will not go into effect until Jan. 1st, 2014. This means everything that comes into CA will continue to sell out.

    Once the media starts to cover this news regarding new laws in CA. demand will grow even stronger. The media have been very quiet here about the new proposed laws. Seems like they are trying to sneak it by the public without citizens getting a chance to complain.

    The point is that S&W continues to sell everything they make and there is no slow up in sight. Earnings will be huge and all the predictions about guns being readily available because demand is dropping is nonsense. Supply and demand push up prices as scene in my purchase over the MSRP. If demand was dropping so would prices!

    Now lets look at S&W recent trading pattern and share price. Since the company produced record earnings on March 6th the share price has fallen 15% to trade at about an 8 price to earnings. All this taking place under the threat of the Senate gun control bill that had no chance of making it past the House even if it had passed in mid-April. We already know it failed and talk of bringing it back? Well that has gone out the window since a new poll released last week showed 62% of the public would like the Senate to drop the bill and move on to other issues. Not to mention all the drama taking place in Washington right now doesn't exactly boost confidence in the decisions the government has been making. It is this same distrust or fear that caused gun sales to surge after the presidents reelection that continues to push sales of firearms today. The share price currently sits at $9.11 even after the company buy back of $35 million in shares and the raising of this quarters earnings estimates. Record earnings one quarter after another, and yet even though it is half the market cap of Ruger, it's share price is 1/6th of Ruger. They currently have a PE of about 14.

    S&W is grossly undervalued! Why isn't the share price higher? One reason is that since October of last year when the stock price was $9 the short interest has risen by 10 million shares even after the share buyback. Since December the short interest has risen to a consistent 14 million or over 20% short position. At the same time the dwindling daily volume has caused the days to cover to rise with my calculation as of May 31st to over 13 DTC. Studying the trading pattern the last 2 months and the failure to cover, the SP has been steadily shorted only to be covered right back to the original price after T+3 (trade plus 3 days). I point this out because the MM and short traders are searching for shares that aren't there. It really appears that nobody is willing to sell at this ridiculously low valuation. S&W should be trading at a share price of over 13 or higher following the chart channel prior to December. Remember sales have skyrocketed and continue to skyrocket since the reelection of the president. The shorts haven't started covering yet! Not for a lack of trying.

    Why should shorts be worried? Well time is running out! S&W reports earnings on June 21st. The stock always rises into earnings. The rise is always quick and the lack of sellers will make it extremely volatile.

    I say this speaking from experience! My previous stock predictions followed similar short interest positions and huge price movement. S&W however is in the best financial position of any company I have followed. The first was Clearwire, which I followed for a long time knowing the true value of the company was its spectrum holdings. Spectrum is a finite thing. There is only so much available and demand is rising. Since December CLWR has risen 400% and continues as Sprint and Dish Network battle for control of the assets.

    The second was Boyd Gaming of which you can read some of my previous articles the last on March 13th. The demand for online gaming was my reason for investing in BYD. Within 45 days of that article Morgan Stanley upgraded the stock on all the grounds I had mentioned with the short squeeze doubling the share price of BYD from less than 7 to over 14 in about 4 weeks.

    Do you see a pattern here? Demand drives up the value of a company and Smith & Wesson has huge demand!

    Be prepared! Smith & Wesson will skyrocket just like their sales. Even if California which already has the strictest gun control laws in the nation adds a few more it won't change the demand, it will only increase demand in the near future as people try and beat the Jan. 1 implementation date of those laws.

    Who is buying? Everyone! There are 30 million people in CA and I watched Hispanics, Blacks, senior citizens all buying today, ahead of the continued rush. From my time in the store I saw people of all ages, men and women. Americans of every ethnicity. The largest increase in gun sales is among seniors and women according to recent articles I have seen on the web. Why? Because seniors as they get older want to protect themselves. The same goes for women. The argument that gun companies will run out of buyers is ludicrous especially with some of the new laws out there. Laws that try and prevent sales of used firearms only drive sales to gun stores. Gun sales have been increasing for years and new buyers are born everyday. Gun owners may own multiple firearms and they purchase accessories for those firearms which add to sales of SWHC and RGR. People are living longer than ever before, so to say that because guns are durable goods they will run out of buyers makes no sense.

    Why are they buying now? Because in America people chose the path of least resistance. When Americans are told something might be taken away or made more difficult use, they create demand. When a product becomes obsolete demand falls, but demand rises when a new improved version comes around. The demand only increases as everyone rushes to get the better product before they are left with the only choice of a less valuable harder to use product. Demand to have the best is the American way. When something may no longer be available, just the threat of losing that product will increase demand as we have seen with the latest sales surge. Continued threats the 2nd Amendment only add up to more sales. S&W is a benefactor of these threats and though the surge may slow as some analyst have suggested it won't be for several more years and it will still stay above sales seen a few years ago. Just because they slow from the massive peak doesn't mean it justifies such a low PE.

    Smith and Wesson (SWHC) is extremely cheap and if, as I predict this quarter, the company will finally use some of their huge growing cash reserves to issue a dividend. Then there will be no holding it back. Don't wait, look at the chart! Look at the trading pattern! See the falling volume with the extremely high short interest. Look at the continued earnings growth, rising guidance and the firearms that continue to fly off the shelves.

    Themes: SPY, DJA, RGR, QQQ, OLN, DKS, DIA, gun stocks, sporting goods, short interest, short squeeze, BYD, CLWR, BGFV, HIBB, earnings, days to cover Stocks: SWHC, RGR, DIA, QQQ, SPY, DJG, OLN, DKS, BGFV, CLWR, BYD
    Jun 4, 2013. 04:08 PM | 4 Likes Like |Link to Comment
  • The 'Retire Young' Portfolio: Which Gun Company To Add?  [View article]
    One more thing! There won't be any new laws to affect the gun stocks! IT'S OFFICIAL! Harry Reid announced on Monday."Someone who has extreme mental problems, they shouldn't be able to buy a gun," Reid said on the Senate floor. Someone who's a criminal shouldn't be able to buy a gun. That's all we want. We'll settle for that. The people of Sandy Hook will settle for that."
    No background checks, no gun restrictions and with the administration trampling on one Constitutional amendment after another, ie. freedom of the press, the attempt on the 2nd amendment, IRS scandal, you can bet that gun sales will continue to surge. If you can't trust your politicians when times are good, how can people trust that the government will be there when things get bad? Look at Katrina, the L.A. riots and after Hurricane Sandy with homes being robbed. Sometime you have to count on yourself for protection.
    May 14, 2013. 02:00 AM | 3 Likes Like |Link to Comment
  • The 'Retire Young' Portfolio: Which Gun Company To Add?  [View article]
    Lets not forget the 23% short interest in SWHC. With 13.7 Millions shares short and volume decreasing we have seen the days to cover increase over 50% in the last 15 days, as of April 30th from 6.4 to 9.91 days. The short interest has remained the same, around 14 million since January. Short interest rose dramatically, by 10 million shares since November, all while the company has purchased back almost 4 millions shares. As a matter of fact SWHC was trading at $9 a share back in Sept. before the stock began to rise and any of these management actions took place. Seriously if you have been watching this stock manipulated for the past 7 weeks as shorts try to find shares to cover, you would realize that nobody is willing to exit such a strong stock in this weak position. What the brokerages don't seem to realize is that SWHC is a SHORT SQUEEZE candidate, which could double following new money or an analyst upgrade. I made this prediction in a Seeking Alpha Blog regarding BYD in early March when it was trading below $7. Morgan Stanley upgraded BYD 2 weeks later pointing out all the facts I had written about. The squeeze BYD is currently having was from a 24% short position. BYD is now above $14. SWHC is in a stronger position than BYD and carries virtually no debt. Mark this post! SWHC will move up violently as soon as new money enters the position.
    May 14, 2013. 01:10 AM | 1 Like Like |Link to Comment
  • Smith & Wesson: Dirt Cheap As Market Is At Peak  [View article]
    It is being hammered down by market makers who wrote all those call options. They don't want to lose money.
    Mar 14, 2013. 11:37 PM | 1 Like Like |Link to Comment
  • Buy Boyd Gaming Ahead Of Online Gambling Approval In New Jersey  [View article]
    Let's not forget that Fitch just said they would upgrade Borgata debt to stable from B- once online gaming passes. It was also reported on CNBC a few minutes ago that CEO of CZR just said on their conference call that New Jersey online gaming is going to be very lucrative for them. Online gaming will add $150-200 million to BYD bottom line and once interstate compacts are signed it could be worth billions.
    Good article, but as we saw again today the share price was heavily shorted to keep the price down.
    Feb 25, 2013. 05:59 PM | Likes Like |Link to Comment
  • Bet Big On This Casino's Secret Weapon  [View article]
    The key to Boyd's share price is the massive short interest. Let's take a look at what has transpired since the 12th. News broke of online gaming being vetoed w/ Christie saying he'd sign modified bill. The short position had been gaining since the 31st w/ the expectation of an outright veto. As BYD began to gain rapidly so did CZR. Over the next 2 days BYD gained 13% with a 50%+ short interest each day. I mean the first day on a spike to 7.55 it was shorted back down to $7.10. Meanwhile CZR gained 40%. Does anyone feel CZR is in better financial shape than BYD? By day 2 CZR had gone from 8+ to 14+ per share. BYD under another day of 50%+ shorting gained only .22 cents. Finally on day 3 after topping out at 8.11 per share in an early morning spike the shorts began to pound BYD back down. Meanwhile CZR held strong with less than a 12% drop. Following the stock the next few days we saw BYD base out at $7.50 only to see Goldman Sachs owners of less than 440K shares as of 9/31 issue a "sell" rating. The rating was given on an opinion that online gaming may take longer than expected. GS has no idea how long online gaming will take! IMO GS is massively short and this rating had more to do with price manipulation than actual value. Do you think this rating is justified? If so why have 10.8 million shares been shorted with price drops of as much as .10 on less than 10K shares in regular movement as the stock price has fallen.
    The rating was issued prior to NJ saying they would pass the bill on Feb. 26th and Christie announcing he would sign it within 1-2 days. In May, 2010 GS paid a $450,000 fine for naked short selling and the SEC censured the firm market making division.The SEC said Goldman initially responded to concerns about naked short selling "by implementing procedures that were inadequate in that they relied too heavily on individuals to perform manual tasks and calculations, without sufficient oversight or verification of accuracy."
    We don't know that naked short selling is still going on, but with almost 50% of the share short and massive shorting on Friday to drive the price back down, IE. 64% for the day, It is fairly obvious that big money is working hard to prevent BYD from seeing its fair value. How many share are really available to be loaned out to the shorts?
    The book vaule of BYD is $13.24. We are currently trading at less than half the book value. When earnings come out I fully expect the usual manipulative sell order to hit driving down the share price. This is done whether the earnings are good or bad. Traders do this because the first new to break is from the media, who will find some excuse to blame the price drop on the only negative they can find. Then the traders can use this in what I predict will be manipulative selling to pick up shares. Then as we've seen the last 2 days accumulate shares to cover their short position. 10.8 million shares shorted to hold the price down! Where is the real value of BYD? It is much higher than it appears!
    Feb 24, 2013. 07:29 PM | 1 Like Like |Link to Comment
  • Bet Big On This Casino's Secret Weapon  [View article]
    Fafa,

    Looking back at your past posts, you are negative ie.short on everything. Must suck when you constantly are wrong!
    Feb 24, 2013. 02:33 PM | 1 Like Like |Link to Comment
  • Bet Big On This Casino's Secret Weapon  [View article]
    You left out the 10.8 million shares that have been shorted since the 15th of the month. This puts the short position close to 50% of the float. Boyd is a prime short sqeeze candidate now. The passage of online gaming on Tuesday w/ Christie signing in "one to two" days after" will be a significant boost to the share price when the media begins to cover the story. I agree earnings will be good. Borgata gaming revenue for the final 3 months of 2012 came in at $153 million from my research, so add in other food/beverage, spa & hotel revenue to those numbers we should beat the $171 million you mentioned.
    Even if the Borgata comes in low, any lose their will be offset with gains from Boyd's newest cash cow, The Kansas Star! It's gaming revenue was 14.9 & 15.6 million for Nov. and Dec. respectively.
    I believe BYD beats big on revenues with $691 million. The high estimate was $677. I don't think they will be positive, but will produce a large beat on earnings which are currently -.13 per share.
    Boyd is ready to pop and the shorts are running out of chances to cover. 64% of shares were shorted on Friday and yet the share price went as high as 6.85. Shorts had to sell over 1 million shares to bring the price back down and maintain control of the stock price.
    I recently recieved an email from Boyd saying that " we will be announcing an earnings date in the coming days". I believe Boyd will use the spike on online gaming news to highlight a positive earnings report and provide clairity to investors. I think they will provide guidance and a timeframe for online gaming which will produce $150-$200 million annually from the Borgata alone. Throw in Nevada and online gaming could add 30% to revenues within a year of activation.
    Finally, lets not forget that earnings for Q1 are already predicted to be positive with earnings growing substantially each following quarter!
    Feb 24, 2013. 12:28 PM | 1 Like Like |Link to Comment
  • The State Of Real-Money Online Gaming In America - Part 1  [View article]
    BYD received a license from Nevada already. They spoke about it in 3rd quarter CC.
    Feb 13, 2013. 12:20 PM | 1 Like Like |Link to Comment
  • The State Of Real-Money Online Gaming In America - Part 1  [View article]
    BYD shares have been shorted over 10 Million shares since news came out on Thursday. This is on top of the 13.1 million short shares reported 1/31. That gives BYD around 40% short at the moment and the share price has risen. GS is obviously short, with a Henry Blodgit calls a vendeta call. They need to cover and don't have the shares to do it. BYD earnings come out on the 20th.
    BYD is actually better situated than the others, since on the 18th they will be the first in the nation to offer in room gambling at the Borgata. Their multiple gaming properties spread out throughout the nation will enable them to be at the forfront of online gaming in other states. Iowa is an example, they have a bill in legislature right now. Yes there will be competition, but BYD and MGM back in 2011 signed with Bwin.com, the largest online gaming group in the world to intergrate their business. So the Borgata is in better position then the players you have listed.
    Feb 13, 2013. 12:07 PM | Likes Like |Link to Comment
  • Sprint's Acquisition Targets: Which Call Options Should You Purchase?  [View article]
    This is a description of CLWR/S relationship. "A deal that involves a smaller carrier where there would be immediate cost benefits, synergies and no distractions."
    Sprint is due to pay CLWR almost 1 Billion over the next 12 months for WiMax and buildout costs.
    Synergy is already there and very evident.
    No distractions avoids having to deal with CLWR management who Hesse has had a very terrible relationship and its and easy approval by the FCC.
    Sep 26, 2012. 10:14 PM | Likes Like |Link to Comment
  • Today's Market News To Trade On: 5 Stocks Moving On News  [View article]
    Then maybe you should put "may" in quotes instead of writing an post with an inference that it won't happen.
    Sep 20, 2012. 12:56 PM | Likes Like |Link to Comment
  • Today's Market News To Trade On: 5 Stocks Moving On News  [View article]
    The only reason CLWR didn't pass $2 as a top was due to a bogus RBC article that was full of misinformation. Hesse has stated in several recent statements including yesterday that CLWR is an important part of Sprints network vision. The past may have been "troubled", but that is in the past if you had listened to the last 2 conference calls from Sprint and Clearwire. For you to write an article using Lightsquared as a basis for your opinion, shows just how out of touch you are with what is really going on between the two companies.
    Sep 20, 2012. 12:20 PM | Likes Like |Link to Comment
  • Today's Market News To Trade On: 5 Stocks Moving On News  [View article]
    Hesse never indicated that CLWR would may not be a strategic target! Spin your crap just like yesterday Smith. You must have been burned badly when the stock rose 13 percent, because I'm sure you know better than all of the investors who bought in yesterday. Why anyone would buy or sell on the opinion of a guy who obviously has other motives makes no sense.
    Sep 20, 2012. 11:24 AM | Likes Like |Link to Comment
  • 4 Short Opportunities To Consider This Year  [View article]
    Dude, you are delusional! CLWR has spectrum holdings of Approx. 17 Billion. They just increased their customer base by 900,000 last quarter alone. They will be EBITDA positive this quarter and revenue beat estimates. You claim to not hold a position but from my point of view, you are a front for the shorts that continue to hammer the stock through every positive news announcement. Considering a real analyst from Credit Swiss predicts a price of $6 and spectrum purchases by Metro PCS or ATT due to their desparate need for spectrum.
    Jan 26, 2012. 06:42 PM | Likes Like |Link to Comment
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