Smith & Wesson Blows the Bottom Line out of the Water

By Chris Lange Updated Jan 13, 6:40AM EST · Published Jun 17, 12:15PM EDT

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Smith & Wesson Blows the Bottom Line out of the Water — © Thinkstock

Smith & Wesson Holding Corp. (NASDAQ: SWHC) reported its fiscal fourth-quarter financial results after the markets closed on Thursday. The company said that it had $0.66 in earnings per share (EPS) on $221.1 million in revenue. The consensus estimates from Thomson Reuters called for $0.54 in EPS on revenue of $214.55 million. In he same period of the previous year, the company posted EPS of $0.40 and $181.00 million in revenue.

The Firearms division had net sales totaling $203.7 million, which was an increase of 22.4% from last year’s comparable quarter. In Accessories division, net sales increased by 19.8% to $17.5 million.

Gross margin for the quarter was 41.6%, compared with 37.1% for the comparable quarter last year.

In terms of the outlook for the fiscal first quarter, the company expects to have EPS in the range of $0.49 to $0.53 on revenues in the range of $190 million to $200 million.

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On the books, the company’s cash and cash equivalents totaled $191.28 million at the end of the quarter, compared to $42.22 million at the end of the previous fiscal year.

James Debney, president and CEO, commented:

Our solid fourth quarter and full year performance further validates our vision, which is to become the leading provider of quality products for the shooting, hunting, and rugged outdoor enthusiast. We continued to successfully execute on our long-term strategy, while delivering financial and operational results that set a number of new company records. In our firearms division, we made several important new product introductions and continued to leverage our flexible manufacturing model, allowing us to benefit from strong consumer demand. In our first full year of accessories revenue, we expanded our product portfolio organically as well as through a targeted acquisition, delivering double-digit top line revenue growth. Looking ahead to fiscal 2017, we expect that a strong balance sheet, combined with our track record of successful acquisitions, positions us well for an expanding role in the market for products for shooting, hunting, and rugged outdoor enthusiasts.

Shares of Smith & Wesson traded up nearly 9% at $23.68 on Friday, with a consensus analyst price target of $28.89 and a 52-week trading range of $14.71 to $30.44.

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About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.