Smith & Wesson Holding Corporation
) announced that its board of directors authorized the repurchase
of $30.0 million of the company's common stock. The company
expects to start the latest share buyback program no sooner than
the beginning of fiscal 2015 (May 1, 2014).
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In the third quarter fiscal 2014 the company used $15.3 million
in cash from financing activities, mainly for its stock
repurchase program. The company repurchased $135 million of its
common stock at an average price of $11.01 from Dec 2012 through
The new authorization by Smith & Wesson is duly supported by
the company's solid financial position, with cash and cash
equivalents (including restricted cash) of $45.3 million as of
Jan 31, 2014. Operating cash was $29.6 million in the third
quarter of fiscal 2014.
Smith & Wesson, a Zacks Rank #2 (Buy) stock, has been posting
strong financial results and surpassing our estimates for the
last 11 quarters. Management has also shared the benefits with
its shareholders through systematic buybacks. Since Dec 2012, the
company reduced the outstanding shares of the company by 19%.
For the fiscal year ending April 30, the company lifted its
earnings per share guidance to the range of $1.39 to $1.42 from
its prior expectation of $1.30 to $1.35. The revenue guidance has
also been boosted to the range of $615 million to $620 million
from $610-$620 million earlier.
For fiscal 2014, the Zacks Consensus Estimate increased 8 cents
to $1.43 per share while for the fiscal fourth quarter the
consensus increased 3 cents to 40 cents per share over the last
Some stocks in the same sector looking equally good include
Marine Products Corp.
TASER International Inc.
Alliant Techsystems Inc.
), all with a Zacks Rank #2 (Buy).