With Washington bent on curbing gun and ammunition availability, sales for such items are soaring across the country, as evidenced by a bang-up quarter from Smith & Wesson Holding Corp. (Nasdaq: SWHC).
SWHC stock jumped some 18% intraday Wednesday to $14.27 after reporting better than expected earnings and revenue growth Tuesday after the close.
Driving the robust fiscal third quarter was a 30% growth in handgun sales, which included Smith & Wesson's popular M&P pistols.
Chief Executive Officer James Debney said on a Tuesday conference call that growth in handgun sales was a "very favorable result when we consider the year ago period included a peak in consumer demand."
Here are the numbers that got Wall Street all fired up…
For the quarter ended Jan. 31, the Springfield, Mass.-based firearm manufacturer posted a profit of $20.8 million, or earnings per share (EPS) of $0.36. That was up 43% from the same quarter a year ago when the company earned $0.22 a share and booked a profit of $14.6 million.
Revenue rose a solid 7% to $145.9 million.
The 162-year-old company also raised its fiscal year earnings outlook and projected an earnings per share profit for the current quarter that exceeded analysts' estimates.
For its fourth (current) quarter, Smith & Wesson forecast EPS of $0.37 to $0.40 on revenue of $159 million to $164 million. Analysts had projected EPS of $0.36 and revenue of $165 million.
For the full fiscal year, the company boosted estimates for per-share earnings to $1.39 to $1.42, with revenue coming in between $615 million and $620 million. That's up from previous estimates of $1.30 to $1.35 EPS on net sales of $610 million to $620 million.
The smoking quarter and healthy guidance are especially impressive after the company's recent rough patch.
SWHC: Bouncing Back After a Bumpy Period
Investors fled Smith & Wesson last month after competitor Sturm, Ruger & Co. (NYSE: RGR), the largest publicly traded U.S. firearm maker, reported Q4 earnings that missed estimates for the first time since 2009 and said sales slipped 20% during 2013.