Smith & Wesson’s Q4 Results Beat Estimates

Smith & Wesson Brands, Inc. (SWBI) reported better-than-expected results for the fourth quarter of Fiscal 2021, driven by significant growth in net sales.

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The company reported quarterly net sales of $322.9 million, growing 67.3% from the prior year. Moreover, it surpassed the consensus estimate of $259.8 million.

The company reported adjusted EPS of $1.71, which compares favorably to $0.50 from the prior year. Furthermore, it topped the consensus estimate of $1.02 per share.

The company declared a quarterly dividend of $0.08 per share, a hike of 60%. The dividend will be paid on July 1, 2021, to shareholders of record as of July 6, 2021. The company’s annual dividend of $0.32 per share now reflects a dividend yield of 1.6%, based on Thursday’s closing price of $20.97.

Mark Smith, CEO of Smith & Wesson Brands, said, “The results of the past year, in spite of the unthinkable challenges that we faced as a nation and as a company, are a tremendous testament to the resolve of our dedicated employees, the power of the Smith & Wesson brand, and the strength of the partnerships we have with our customers. Our employees more than doubled the prior year sales, passed a milestone of $1 billion in revenue, and by every financial and operating metric, have delivered the most successful year in the 169 year history of the company. But most importantly, we have set a rock solid foundation for the long term success of the company, with astounding market share growth. During the past fiscal year, the US firearms market experienced record growth of 42%, meanwhile shipments from Smith & Wesson far surpassed the industry, growing by 70%. Strong consumer preference for our products combined with our ability to rapidly react to the increased demand has placed us in a clear leadership position as we enter into our first full fiscal year as a standalone pure-play firearms company.” (See Smith & Wesson Brands stock analysis on TipRanks)

Following the results, Cowen analyst Cai Rumohr reiterated a Buy rating and a price target of $30.50. This implies 33% upside potential from current price levels.

Consensus among analysts is a Moderate Buy based on 1 Buy and 1 Hold. The SWBI average analyst price target of $25.25 implies approximately 9% upside potential over the next 12 months.

Smith & Wesson Brands scores a 9 out of 10 from TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations. Shares have gained about 38.5% over the past year.