Smith and Wesson stocks drop 21%

Smith and Wesson stocks dropped 21% Tuesday after S&W released their earnings report Monday after the close. 

With earnings missing what analysts expected, the company said the write offs were contributed to a $76.2 million, or $1.62 a share loss, in the period ended Oct. 31 They also said that they had a $76.5 million impairment charge, which is net of a $21.8 million adjustment to deferred tax credit to reflect the impairment of goodwill on its purchase of Thompson/Center Arms in 2007.

Thompson Center is the company that S&W bought last year in 2007.  In today’s economy, hunting related businesses are having a hard time.  And with S&W being sort-of new in the hunting long gun game, they felt the weakness also.  S&W/TC rifle sales fell 41 percent because hunting guns are considered discretionary in this ruff economy.   But on the other hand, with the anti-gun Obama taking over the White House, there is some good news for gun makers.  Anything AR-15 related and semi-auto carry guns, the sales have actually risen in those segments.  In fact S&W’s line of M&P and Sigma pistols had strong sales numbers.  They said pistol sales rose 40 percent on continued consumer demand, law enforcement adoption of the M&P polymer pistol line and strong consumer sales of the Sigma pistol line.

To find out all the details, do your homework!  The stock symbol is “SWHC”