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Smith & Wesson (SWBI) Gains But Lags Market: What You Should Know

Smith & Wesson (SWBI) closed at $23.63 in the latest trading session, marking a +0.55% move from the prior day.

This story originally appeared on Zacks

Smith & Wesson (SWBI) closed at $23.63 in the latest trading session, marking a +0.55% move from the prior day. This move lagged the S&P 500's daily gain of 0.85%.

- Zacks

Prior to today's trading, shares of the firearm maker had gained 0.51% over the past month. This has outpaced the Consumer Discretionary sector's loss of 1.2% and lagged the S&P 500's gain of 2.85% in that time.

SWBI will be looking to display strength as it nears its next earnings release, which is expected to be September 1, 2021. The company is expected to report EPS of $1.26, up 29.9% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $296.2 million, up 6.56% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $4.40 per share and revenue of $903.4 million, which would represent changes of -3.08% and -18.41%, respectively, from the prior year.

Any recent changes to analyst estimates for SWBI should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. SWBI is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, SWBI is currently trading at a Forward P/E ratio of 5.35. For comparison, its industry has an average Forward P/E of 12.19, which means SWBI is trading at a discount to the group.

The Leisure and Recreation Products industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 20, which puts it in the top 8% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.

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