Smith & Wesson Profit Soars; Provides Upbeat Outlook (SWHC)

Gun manufacturer Smith & Wesson (NASDAQ: SWHC) released its fiscal fourth-quarter financial results on Tuesday after the closing bell. The company reported earnings and revenue that came in ahead of consensus estimates and also provided Q1 and full-year guidance which was well ahead of expectations. In late trade, Smith & Wesson shares were last up 0.40 percent to $10.03. The stock added 3.74 percent during the regular trading session to $9.99. Management CommentaryJames Debney, Smith & Wesson Holding Corporation President and Chief Executive Officer, stated, "We are pleased with our results, which include record fourth quarter and annual net sales and profits and a substantial expansion of our gross margins. Our successful performance was driven by solid marketing, innovative new products, disciplined manufacturing execution, and strict financial management. Significant increases in our manufacturing capacity, combined with continued robust consumer demand for firearms, resulted in higher sales of our most popular M&P® products. Our achievements over the year aligned directly with our growth strategy, which is underpinned by a focus on our core firearm business. Having completed another year of successfully executing our strategy, we are today issuing our financial outlook for the first quarter and full fiscal year 2014."Q4 Results The company reported net income of $25 million or $0.38 per share, compared to $12.5 million or $0.19 per share, in last year's corresponding period. Income from continuing operations was $28.6 million or $0.44 per share, versus $17.8 million or $0.27 per share, in last year's fourth-quarter. This was in-line with Wall Street analysts' consensus EPS estimates of $0.44. The results, however, included a $0.03 expense charge associated with a product recall. Revenue in the quarter was up 38 percent to $179 million from $130 million in the year ago period. This easily topped analysts' consensus revenue estimates of $170.72 million. Gross margin in the fourth-quarter was 38.3 percent from 36.1 percent last year. Smith & Wesson Provides Strong Q1 and Full-Year Guidance Looking ahead to Q1, the company said that it expects adjusted EPS of $0.34 to $0.37 on sales of $162 million to $167 million. Currently, analysts anticipate Smith & Wesson will report EPS of $0.30 on revenue of $141.15 million in the fiscal first-quarter. For the fiscal year, Smith & Wesson guided for earnings from continuing operations of $1.30 to $1.35 on sales of $605 million to $615 million. This compares to current consensus calling for EPS of $1.13 on sales of $590.36 million for the fiscal year.