Smith & Wesson (SWHC) (S&W) is a manufacturer of firearms and BB guns in the United States. The corporate headquarters is in Springfield, Massachusetts. Founded in 1852, Smith & Wesson's pistols and revolvers have become standard issue to police and armed forces throughout the world, in addition to their popularity among sport shooters. Their revolvers have been featured in numerous Hollywood movies, notably Clint Eastwood's Dirty Harry. Apart from firearms, Smith & Wesson has been known for the many types of ammunition it has introduced over the years, and many cartridges bear the company's name.
Three Investment Firms Downgraded This Gunmaker and Its Shares Are in Freefall Consumers bought so many guns in past quarters that Smith and Wesson will see demand slow in this quarter. That’s according to Cowen and Company, which lowered expectations for Smith and Wesson SWHC -17.94% to market perform early Monday. That downgrade was followed by CL King, and BB&T Capital, who cut their rating on the stock to neutral and hold respectively—sending shares down 18%, nearly erasing the stock’s gains year-to-date. Both Cowen and BB&T analysts noted that demand for guns seemed to be weakening as of late, pointing to data from the National Instant Criminal Background Check System, which reported that the number of background checks for gun buyers fell 13.2% in March from the month prior—the “weakest of the past decade and well below ten year averages,” wrote the team of analyst at Cowen led by Cai von Rumohr. The news comes after Smith and Wesson reported stellar sales for firearms in the third quarter, driven by buyers who were concerned about increasing gun control laws. The current period’s demand however has been driven by consumers seeking personal protection following terrorist attacks in Paris—leading buyers to stockpile handguns in anticipation of recurring attacks, Cowen noted. But that cuts into future gun demand—at least in the short term. Likewise, BB&T analysts also cited the surge in demand for guns as a problem for Smith and Wesson. Brian Ruttenbur wrote that increased consumer demand chipped away at the company’s inventory—suggesting that the gunmaker would have to rely on outsourced production if demand does pick up. “We believe Smith and Wesson’s increased use of outsourced production will limit its sales and margin upside in the near-term,” Ruttenbur wrote. Though both firms have also said that they can only speak about the company’s near term performance. Cowen noted the data from the NCIS was cyclical, so the firm is “reluctant to over-read it.” The number of background checks grew year-over-year, by 9.2% in March. Cowen maintained 2017 estimates of $1.80 earnings per share for Smith and Wesson. Shares of fellow gunmaker Sturm, Ruger and Company RGR -8.91% also slid 8% in mid-day trading.
SWHC has an interesting chart here. 200MA shows an increasing trend as well as 50MA. Sitting right at support after a massive sell-off on the 4th of April. Could be headed back up if it doesn't break through support.
Gun-related stocks plunge on reports of slowing background checks Shares of gun stocks Smith & Wesson (SWHC) and Sturm, Ruger & Co. (RGR) stumbled Friday on reports that a background check system run by the FBI showed slowing growth in May. Read full article here: http://www.msn.com/en-us/money/comp...ports-of-slowing-background-checks/ar-BBtPZMt
I have to work tomorrow and can't be on my phone normally so I'm going to set a stop before market close today.
Move back up to resistance at $24 would be a perfect trade, in a perfect world, so thats not going to happen
As usual, after every mass shooting... SWHC, the stock that always rallies after there terrible event.
Glad I bought when I did. Feels like I timed something better than usual for once. Certainly didn't expect a mass shooting though...
Quite the drop-off today. I wonder if anybody has been tracking the "day after a violent crime" gun sales go up, and the day after it sells back to it's previous point. Seems like it would be a decent short the day after the gains if it's a regular occurrence.
For Dangerloot. Tried to break through support of the 200MA multiple times but stayed above. The one day it closed below was the day before the shooting. It could have opened above the next day as well and held support at the 200MA. If it closes below, there's a good chance it stays below and then the 200MA will act as resistance.
