Smith & Wesson Holding Earnings: Here’s Why the Stock is Down Now

Smith & Wesson Holding Corporation (NASDAQ:SWHC) delivered a profit and met Wall Street’s expectations, AND beat the revenue expectation. The revenue beat is a positive sign to shareholders seeking high growth out of the company. Shares are down 0.8%.

Smith & Wesson Holding Corporation Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 62.96% to $0.44 in the quarter versus EPS of $0.27 in the year-earlier quarter.

Revenue: Rose 37.63% to $178.7 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Smith & Wesson Holding Corporation reported adjusted EPS income of $0.44 per share. By that measure, the company met the mean analyst estimate of $0.44. It beat the average revenue estimate of $170.72 million.

Quoting Management: James Debney, Smith & Wesson Holding Corporation President and Chief Executive Officer, stated, “We are pleased with our results, which include record fourth quarter and annual net sales and profits and a substantial expansion of our gross margins. Our successful performance was driven by solid marketing, innovative new products, disciplined manufacturing execution, and strict financial management. Significant increases in our manufacturing capacity, combined with continued robust consumer demand for firearms, resulted in higher sales of our most popular M&P® products. Our achievements over the year aligned directly with our growth strategy, which is underpinned by a focus on our core firearm business. Having completed another year of successfully executing our strategy, we are today issuing our financial outlook for the first quarter and full fiscal year 2014.”

Key Stats (on next page)…

Revenue increased 31.17% from $136.24 million in the previous quarter. EPS increased 69.23% from $0.26 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.31 to a profit $0.30. For the current year, the average estimate has moved up from a profit of $1.20 to a profit of $1.22 over the last ninety days.

Stocks with improving earnings metrics are worthy of your extra attention. In fact, “E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our CHEAT SHEET investing framework for this very reason. Don’t waste another minute – click here and get our CHEAT SHEET stock picks now.

(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at]