Smith & Wesson (SWBI) closed at $19.83 in the latest trading session, marking a -1.15% move from the prior day. This change lagged the S&P 500’s daily gain of 0.99%.
Heading into today, shares of the firearm maker had gained 12.82% over the past month, outpacing the Consumer Discretionary sector’s loss of 2.14% and the S&P 500’s loss of 0.26% in that time.
SWBI will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $1.07, up 87.72% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $273.5 million, up 17.06% from the year-ago period.
Investors might also notice recent changes to analyst estimates for SWBI. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
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. Within the past 30 days, our consensus EPS projection has moved 23.05% higher. SWBI is holding a Zacks Rank of #1 (Strong Buy) right now.
Looking at its valuation, SWBI is holding a Forward P/E ratio of 9.11. For comparison, its industry has an average Forward P/E of 14.46, 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 35, which puts it in the top 14% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.