The company reported adjusted earnings of $0.04 per share, topping the estimated $0.02 per share, according to Fiscal.ai data.
- If the gains hold, the stock could log its biggest single-day percentage gain since March 2024.
- The company said its new product offerings and disciplined approach to clear inventory bolstered its earnings.
- After enjoying a surge in demand during the pandemic amid growing political hostilities, gunmakers have seen demand scale back.
Smith & Wesson Brands (SWBI) stock jumped over 18% on Friday after the gunmaker’s fiscal second-quarter (Q2) earnings topped Wall Street’s estimates.
The company reported adjusted earnings of $0.04 per share, topping the estimated $0.02 per share, according to Fiscal.ai data. The company reported net sales of $124.7 million, narrowly topping estimates. If the gains hold, the stock could log its biggest single-day percentage gain since March 2024. Peer Sturm Ruger & Company also rose 3.2%.
What Drove Q2 Earnings?
After enjoying a surge in demand during the pandemic amid growing political hostilities, gunmakers have seen demand scale back. President Donald Trump’s re-election has also eased concerns over strict gun regulations, affecting gun sales, while consumer sentiment has also remained weak following the imposition of sweeping tariffs.
However, the company said its new product offerings and disciplined approach to clear inventory bolstered its earnings. The firm said its inventory decreased by $20 million, compared with an increase of $6.2 million in the prior-year quarter. Its overall average selling price rose 3.5% compared to the year-ago period, including a 2.1% increase in handguns to $418 and a 10.2% increase in long guns to $602.
“Although we continue to see uncertainty regarding macro-economic conditions, including tariffs, we believe that the strength of our brand, product assortment, and new product offerings should allow us to continue performing well,” Chief Financial Officer Deana McPherson said. “Our third quarter sales will be 8-10% over our Q3 fiscal 2025 sales with no significant impact, either positively or negatively, from channel inventory.
What Are Stocktwits Users Thinking?
Retail sentiment on Stocktwits about Smith & Wesson was in the ‘bullish’ territory compared to ‘bearish’ a week ago.
One Stocktwits user said that the stock could hit its 52-week high of $11.41 if the positive momentum sustains.
Smith and Wesson stock has gained nearly 21% this year.
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