Smith & Wesson Raises Guidance, for Now

What happens after an election cycle that causes some panic to gun owners and gun enthusiasts? Gun sales go through the roof. You had already seen guidance raised here but now we have it again. Unfortunately, this is a trend that may not have the same trajectory ahead as it has seen recently ahead of the election. Smith & Wesson Holding Corp. (NASDAQ: SWHC) announced preliminary net sales and earnings ahead of expectations.

The company shows that its preliminary net sales from continuing operations for its second quarter were up by approximately 48% to $136 million. This projection was above the prior guidance of $130 million to $135 million due to continued strength in orders across its product lines. Its preliminary GAAP net income from continuing operations was also lifted to $0.23 to $0.24 per diluted share versus its prior range of $0.19 to $0.21 per share. Thomson Reuters was looking for $0.21 EPS and $134.78 million in revenue.

Dirty Harry’s best friend also reiterated its guidance for 30% net sales from continuing operations for full year fiscal 2013 of between $530 million and $540 million. Its fiscal GAAP earnings guidance is now $0.85 and $0.90 per share. For the year, Thomson Reuters is calling for $0.87 EPS and $536.62 million in sales.

While this is raised guidance, the reality is that by beating earnings estimates but only reiterating its full-year guidance that translates to slightly lower sales in the next two quarters if the company is not sand-bagging its numbers.

Shares rose by 6.5% to $10.05 on the day but the stock is indicated down 2% around $9.85 in the after-hours.

JON C. OGG