Firearms manufacturer American Outdoor Brands Corp. (AOBC, Financial) reported its fiscal first-quarter 2018 results after the market closed on Sept. 7.
The Massachusetts-based company, which was formerly known as Smith & Wesson Holding Corp., posted a loss of 4 cents per share, missing expectations of 11 cents. Revenue of $129 million fell short of estimates of $148 million and declined 37.7% from the prior-year quarter.
The stock, which closed at $16.94 on Thursday, plummeted over 16% in after-hours trading following the announcement.
The trend in the company’s revenue growth over the past decade is illustrated in the graph below.
President and CEO James Debney attributed the company’s performance to lower shipments in its firearms business, which was slightly offset by increased revenue in the outdoor products and accessories business.
“Total revenue for the quarter also faced a challenging comparison to last year's heightened level of firearms demand, which we believe was driven by concerns for personal safety and the potential for increased firearm legislation,” Debney said.
The company lowered its guidance for fiscal 2018. Full-year EPS is projected to range from $1.04 to $1.24, down from the previous outlook of between $1.42 and $1.62 per share. Revenue was cut to between $700 million and $740 million, which was previously $750 million to $790 million.
With 0.56% of outstanding shares, Chuck Royce (Trades, Portfolio) is the company’s largest guru shareholder. He added to his position during the second quarter. In contrast, Steven Cohen (Trades, Portfolio) reduced his holding while David Dreman (Trades, Portfolio), Joel Greenblatt (Trades, Portfolio) and Paul Tudor Jones (Trades, Portfolio) sold out.
Disclosure: I do not own any stocks mentioned.
