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Smith & Wesson Brands, Inc. (SWBI)
NASDAQ:SWBI
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Smith & Wesson Brands
(NASDAQ:SWBI)
59Neutral
Smith & Wesson Brands (SWBI) vs. S&P 500 (SPY)
Market Cap
$441.79M
Dividend Yield5.08%
Average Volume (3M)515.14K
Price to Earnings (P/E)15.1
Beta (1Y)0.19
Revenue Growth-5.77%
EPS Growth14.45%
CountryUS
Employees1,501
SectorIndustrials
Sector Strength72
IndustryAerospace & Defense
Share Statistics
EPS (TTM)0.65
Shares Outstanding44,002,705
10 Day Avg. Volume758,896
30 Day Avg. Volume515,144
Financial Highlights & Ratios
PEG Ratio1.05
Price to Book (P/B)N/A
Price to Sales (P/S)0.90
Price to Cash Flow (P/CF)-11.20
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$14.25Price Target Upside41.93% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
Smith & Wesson Brands Business Overview & Revenue Model
Company DescriptionSmith & Wesson Brands, Inc. is a leading manufacturer of firearms and firearm-related products, primarily serving the law enforcement, military, and civilian markets. Established in 1852, the company is renowned for its high-quality handguns, rifles, and related accessories. Smith & Wesson operates within the consumer discretionary sector and focuses on delivering innovative and reliable products that meet the diverse needs of its clientele.
How the Company Makes MoneySmith & Wesson Brands, Inc. generates revenue primarily through the sale of firearms and firearm-related accessories. The company's key revenue streams include handguns, such as revolvers and pistols, as well as long guns, which comprise rifles and shotguns. Additionally, Smith & Wesson offers a range of firearm accessories and branded merchandise. The company's earnings are significantly influenced by factors such as consumer demand, regulatory changes, and its ability to maintain a prominent position in the firearms market. Smith & Wesson also engages in partnerships and distribution agreements to extend its market reach, ensuring its products are available through various channels, including direct sales to law enforcement and military agencies, as well as through a network of dealers and retailers.
Smith & Wesson Brands Financial Statement Overview
Summary
Smith & Wesson Brands shows a stable financial structure with a robust balance sheet and zero debt. However, declining revenue and profitability trends in the income statement, along with challenges in cash generation, highlight areas for improvement.Income Statement
Smith & Wesson Brands has shown fluctuating revenue trends, with a noticeable decline in recent years from its peak in 2021. The gross profit margin for TTM (Trailing-Twelve-Months) is approximately 29.65%, while the net profit margin stands at 6.05%, indicating moderate profitability. The EBIT and EBITDA margins are also modest at 7.00% and 11.82%, respectively, reflecting tight operational efficiencies. Overall, the income statement suggests stable but declining performance with room for improvement in operational margins.65
Positive
Balance Sheet
The balance sheet of Smith & Wesson Brands shows a solid equity position with zero total debt in the latest TTM period, resulting in a healthy debt-to-equity ratio of 0. The return on equity (ROE) for TTM is 8.19%, demonstrating reasonable returns for shareholders. The equity ratio stands at 62.92%, highlighting a strong equity base compared to total assets. These metrics indicate a stable financial structure with low leverage and robust shareholder equity.75
Positive
Cash Flow
The cash flow statement reveals challenges in cash generation, with negative free cash flow of -$10.03 million in the latest TTM period. The operating cash flow to net income ratio is negative, indicating issues in converting income into cash. The free cash flow to net income ratio is also negative, reflecting cash flow pressures. The company has previously demonstrated positive cash flows, but recent periods suggest a need for better cash management strategies.50
Neutral
| Breakdown | |||||
| TTM | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 | Jun 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 493.05M | 535.83M | 479.24M | 864.13M | 1.06B | 678.39M | Gross Profit |
| 146.19M | 158.09M | 154.54M | 374.56M | 448.98M | 234.71M | EBIT |
| 34.52M | 44.78M | 48.41M | 251.65M | 319.63M | 49.93M | EBITDA |
| 58.26M | 84.01M | 81.10M | 251.65M | 319.63M | 81.59M | Net Income Common Stockholders |
| 29.80M | 39.61M | 36.88M | 194.49M | 252.05M | -61.23M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 26.70M | 60.84M | 53.56M | 120.73M | 113.02M | 125.40M | Total Assets |
| 578.86M | 578.00M | 541.29M | 497.48M | 446.39M | 728.96M | Total Debt |
| 145.10M | 78.37M | 61.75M | 40.28M | 38.79M | 199.04M | Net Debt |
| 118.39M | 17.53M | 8.20M | -80.45M | -74.23M | 73.65M | Total Liabilities |
| 214.79M | 179.84M | 156.67M | 136.96M | 180.00M | 341.84M | Stockholders Equity |
| 364.07M | 398.16M | 384.62M | 360.51M | 266.38M | 387.12M |
| Cash Flow | Free Cash Flow | ||||
| -10.03M | 15.79M | -73.17M | 113.56M | 292.65M | 80.22M | Operating Cash Flow |
| -4.43M | 106.74M | 16.73M | 137.81M | 315.33M | 94.96M | Investing Cash Flow |
| -10.81M | -81.49M | -89.78M | -24.12M | -23.40M | -13.96M | Financing Cash Flow |
| -5.42M | -17.97M | 5.88M | -105.99M | -303.92M | 3.38M |
Smith & Wesson Brands Technical Analysis
Negative
10.04
Price Trends
10.46
Negative
11.39
Negative
12.81
Negative
Market Momentum
-0.23
Positive
43.00
Neutral
37.39
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SWBI, the sentiment is Negative. The current price of 10.04 is below the 20-day moving average (MA) of 10.53, below the 50-day MA of 10.46, and below the 200-day MA of 12.81, indicating a bearish trend. The MACD of -0.23 indicates Positive momentum. The RSI at 43.00 is Neutral, neither overbought nor oversold. The STOCH value of 37.39 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SWBI.
Smith & Wesson Brands Risk Analysis
Smith & Wesson Brands disclosed 33 risk factors in its most recent earnings report. Smith & Wesson Brands reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Smith & Wesson Brands Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $677.52M | 22.84 | 9.39% | 1.71% | -1.49% | -34.38% | |
65 Neutral | $293.02M | 11.62 | 10.78% | ― | -1.16% | 227.49% | |
61 Neutral | $8.21B | 13.22 | 1.07% | 3.07% | 3.78% | -16.88% | |
59 Neutral | $441.79M | 15.11 | 8.05% | 5.08% | -5.77% | 14.45% | |
55 Neutral | $2.84B | 26.19 | 5.10% | 3.25% | -4.29% | -74.85% | |
46 Neutral | $173.38M | ― | -4.37% | ― | -14.06% | -102.73% |
* Industrials Sector Average
Performance Comparison
SWBI
Smith & Wesson Brands
10.04
-7.08
-41.36%
OLN
Olin
24.64
-31.05
-55.76%
RGR
Sturm Ruger & Company
40.42
-4.67
-10.36%
MEC
Mayville Engineering Company
14.35
1.26
9.63%
POWW
AMMO
1.46
-1.00
-40.65%
Smith & Wesson Brands Earnings Call Summary
Earnings Call Date: Mar 6, 2025 | % Change Since: -8.89% | Next Earnings Date: Jun 19, 2025
Earnings Call Sentiment Neutral
Smith & Wesson displayed strong new product performance and effective inventory management, but faced significant challenges with overall revenue decline and lower margins. The sentiment is balanced between positive innovation and negative financial outcomes.Highlights
Strong New Product Performance
New products introduced within the past year accounted for over 41% of sales in the quarter, indicating successful innovation and strong market reception.
Long Guns ASP Increase
Average Selling Prices (ASP) for long guns increased by 17.2% in Q3, driven by strong demand for higher-priced lever rifles.
Inventory Management Success
Channel inventory at distributors is very clean, currently at under nine weeks, ensuring a balanced supply chain.
Capital Return to Shareholders
Smith & Wesson returned more than $49 million to shareholders via stock repurchases and dividends over the past twelve months.
Lowlights
Overall Revenue Decline
Net sales for the third quarter were $115.9 million, down 15.7% compared to the prior year, mainly due to lower demand for core products and persistent inflation.
Handgun ASP Decline
Average Selling Prices (ASP) for handguns declined by 7.8%, reflecting strong demand for lower-priced products like the Bodyguard 2.0.
Reduced Production Margins
Gross margin fell to 24.1%, down 4.6% from the previous year, due to lower production volumes and higher promotional costs.
Lower Full-Year Revenue Projection
The company expects full-year revenue to decrease by 5-10% from fiscal 2024 levels, with Q4 projected to be down 2-5% from the prior year.
Company Guidance
During the Smith & Wesson Brands, Inc. Third Quarter Fiscal 2025 Financial Results Conference Call, the company provided several key metrics and guidance for the upcoming quarters. The top-line revenue for the third quarter was reported at $115.9 million, representing a 15.7% decline from the previous year. Despite this, the company maintained its EPS and EBITDA expectations through lower operating expenses and a flexible manufacturing model. New products accounted for over 41% of sales in the quarter, with the Bodyguard 2.0 driving demand in the handgun category despite a 7.8% decline in handgun ASPs. Long gun ASPs increased by 17.2%, driven by demand for higher-priced lever rifles. Adjusted NICS was down 4.5%, indicating a decrease in consumer firearm demand, yet the company noted a 20% compounded annual growth rate in long gun unit sales over two years. Operating expenses were $23.8 million, reduced by $4.3 million from the prior year, and the company ended the quarter with net income of $1.7 million or $0.04 per share. Smith & Wesson expects full-year revenue to decline by 5-10% compared to fiscal 2024, with the fourth quarter projected to see a 2-5% reduction from the prior year. The company also highlighted a strong balance sheet, plans for additional share repurchases, and a $0.13 quarterly dividend.Smith & Wesson Brands Corporate Events
Executive/Board Changes
Smith & Wesson Announces VP Sales Retirement
Neutral
Jan 17, 2025
Smith & Wesson Brands, Inc. announced the upcoming retirement of Sue Cupero, the Vice President of Sales, who will retire in May 2025 after more than four decades of service. Cupero has been instrumental in shaping sales strategies and building market presence, and her departure will mark the end of an era at the company. The search for her successor will begin immediately, ensuring a smooth transition and continued legacy of strong client relationships.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.