B. Riley increases bullishness on Sportsman’s Warehouse after investor day

Sep. 26, 2022 11:30 AM ETSportsman's Warehouse Holdings, Inc. (SPWH)By: Kevin P. Curran, SA News Editor

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B. Riley Securities analyst Eric Wold advised clients that the company’s inaugural investor day offered good reason to raise estimates on Sportsman’s Warehouse Holdings (NASDAQ:SPWH).

“Under the backdrop of continued elevated outdoor activity participation trends following the initial pandemic-driven boost, we came away from the Investor Day increasingly optimistic about SPWH's potential to gain incremental market share and customer loyalty,” he wrote in a note on Monday. “In addition to management's plans to accelerate store growth in the coming years with the flexible store format, we believe the departure of other competing retailers from the firearms and ammo segments provides an attractive set-up for repeat purchase activity and store visits.”

He noted that the stock is trading at a significant discount to its pre-pandemic levels despite this setup. With the refresh of storefronts is expected to bring sales up to these levels, Wold indicated he believes this discount is unfair. Further, he said $52M in share repurchases in the past quarter speaks to “management's apparent optimism toward the market opportunity” still ahead.

As such, Wold raised his 2023 revenue estimate to $131M from $126M and EPS estimates from $1.54 to $1.58. In line with the raised estimates, he upped his price target to $16 from a prior $14 and reiterated a Buy rating.

Shares of Sportsman Warehouse Holdings (SPWH) rose 3.56% on Monday.

Dig into the company’s valuation.

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