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Smith & Wesson - AI Stock Analysis
Analysis generated June 20, 2024
Smith & Wesson Brands, Inc. (SWBI) is an American manufacturer of firearms, founded in 1852. The company is headquartered in Springfield, Massachusetts, and is well known for its wide range of handguns, rifles, and related products. Smith & Wesson has a storied history and a strong brand presence in the firearms industry. It operates in a sector that often sees fluctuating demand due to various political, social, and regulatory factors.
Fundamental Analysis
Revenue for the last quarter was $137 million. This represents a 10.07% increase compared to the previous quarter and a 6.10% increase compared to the same quarter last year. This suggests positive growth and resilience amidst varying market conditions. Net income for the last quarter was $7.9 million, showcasing an impressive 215.53% increase from the previous quarter, though it is down 28.86% year over year. While the year-over-year decrease could be concerning, the substantial quarter-over-quarter improvements highlight recent success.
EBITDA for the last quarter was $18 million, representing a 50.27% increase from the previous quarter but a 17.71% decrease from the same quarter last year. This mixed performance can be critical to analyze further. The current P/E ratio stands at 28.67, which could be seen as high, potentially indicating that the stock might be overvalued, which can be a bearish sign.
Technical Analysis
Today's stock price is $16.34, showing a 2.06% increase from the past month and a 44.60% climb over the past year, signaling a strong long-term bullish trend. The current Simple Moving Average (SMA) over ten days (SMA10) is 16.18, slightly higher than the previous SMA10 of 16.17. This small increment indicates a potential upward trend. The Relative Strength Index (RSI) stands at 63.6, which is in the neutral territory, suggesting neither overbought nor oversold conditions for the stock.
Alternative Data Analysis
Smith & Wesson currently has 24 open positions according to data from popular job boards, which is a 33% increase in recent months and could indicate expansion or growth plans. However, the business outlook has declined by 32% in the same period, which is concerning. Web traffic shows Smith & Wesson's website had an estimated 1.9 million visitors, a drop of 25%, suggesting potential customer loss or reduced engagement.
On social media, Smith & Wesson maintains 1.2 million followers on Instagram with no changes over a couple of months, indicating stagnant interest, and 450,000 followers on Twitter without significant movement. Moreover, AltIndex’s AI score rates Smith & Wesson at 25, a strong sell signal based on a combined analysis of various data points.
Conclusion and Recommendation
In conclusion, Smith & Wesson presents a mixed bag of performance indicators. The recent revenue and net income growth provide a buoyant outlook for the near term. However, the year-over-year declines in net income and EBITDA are points of concern that cannot be ignored. The technical indicators point towards a yet ongoing bullish trend, albeit cautiously. The alternative data shed light on potential weaknesses in customer acquisition and business outlook.
Given these analyses, Smith & Wesson appears to have short-term gains but faces critical challenges that may impact long-term performance. The high P/E ratio and the strong sell signal from AltIndex’s AI score further underscore potential overvaluation and caution.
Based on all provided data, the recommendation would be to exercise caution and consider a hold approach for existing investors, while prospective investors might want to wait for more favorable entry points or clear signs of sustainable growth.
Disclaimer: This AI stock analysis, generated by an experimental AI tool, is for informational purposes only and not financial advice. Information is based on publicly available data and may not always be accurate or current.