Smith & Wesson Brands, Inc. (NASDAQ:SWBI) is among the 10 Best Low Priced Defense Stocks to Buy Now, with 14 hedge funds holding a stake in the company, according to Insider Monkey’s database for Q1 2025.
An overhead aerial shot of a gunsmiths workshop, surrounded by tools of the trade.
However, the stock is down 21% year-to-date, with a significant plunge over the past month, following the company’s fourth-quarter earnings call for fiscal 2025. Smith & Wesson Brands, Inc. (NASDAQ:SWBI) reported an 11.6% year-over-year decrease in net sales. Non-GAAP net income declined from $22.1 million in the prior year to $9 million. Gross margin stood at 28.8%, down from 35.5% last year.
The company cited industry trends and macroeconomic challenges as factors behind a difficult quarter. However, the management remains confident that while the headwinds are likely to continue in the near term, SWBI is well-positioned to succeed, in part due to the continued strong performance of new products, helping the firm to maintain its dominant position in the firearms market.
Based on the analysis of three rating firms, Smith & Wesson Brands, Inc. (NASDAQ:SWBI) has a one-year share price target of $12, representing a 49% upside potential. Following the recent earnings call, Lake Street lowered the stock’s price target to $11 from $12.5, but maintained a Buy rating for its shares.
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Disclosure: None.