Significant Increase in Short Interest for Smith & Wesson Brands, Inc.

Smith & Wesson Brands, Inc. (NASDAQ:SWBI) experienced a notable rise in short interest throughout December. As recorded on December 15th, the short interest for the company reached a total of 2,200,000 shares, marking an increase of 33.3% compared to the November 30th figure of 1,650,000 shares. With an average daily trading volume of 589,200 shares, the days-to-cover ratio currently stands at 3.7 days. Presently, 5.1% of the company's shares are reported as shorted.

Market Reactions

In recent evaluations, several brokerages have adjusted their ratings and assessments on Smith & Wesson Brands. Craig Hallum downgraded the company from a "buy" to a "hold" rating, reducing the price target from $18.00 to $13.00 on December 6th. Similarly, Lake Street Capital also downgraded the stock from a "buy" to a "hold" rating with the same price target adjustments on the same day.

Institutional Investor Movements

Multiple hedge funds and institutional investors have recently updated their positions in Smith & Wesson Brands. For instance, Rhumbline Advisers raised its stake by 0.8% during the second quarter, now holding 79,360 shares valued at approximately $1,138,000 after acquiring an additional 655 shares. Cetera Investment Advisers increased its investment by 1.8%, amassing a total of 80,650 shares worth $1,157,000 after adding 1,421 shares in the same quarter. Franklin Resources Inc. also boosted its holding by 5.8%, taking its ownership to 29,249 shares valued at $378,000, following the acquisition of 1,598 more shares. Over half of the total stock, approximately 59.33%, is now owned by hedge funds and institutional investors.

Latest Stock Performance

On the trading front, shares of Smith & Wesson Brands fell by 0.9%, trading at $9.94 on Friday. A total of 428,260 shares exchanged hands, surpassing the average volume of 453,017. The company holds a market cap of $437.39 million, with a price-to-earnings ratio of 12.74 and a beta of 0.96. The 50-day simple moving average stands at $12.45 while the 200-day average is at $13.70. The stock has seen a 12-month low of $9.78 and a high of $18.05, with a debt-to-equity ratio of 0.36 and liquidity ratios indicating a quick ratio of 1.43 and a current ratio of 3.97.

Earnings Report Summary

Smith & Wesson Brands recently published its earnings results on December 5th. It reported earnings per share (EPS) of $0.11 for the quarter, falling short of the analysts' average estimate of $0.17 by $0.06. The company posted a return on equity of 8.78% and a net margin of 7.00%. Quarterly revenue reached $129.70 million, slightly below the expected $133.53 million, but reflecting a year-over-year growth of 3.8%. Analysts forecast that Smith & Wesson Brands will achieve an EPS of $0.47 for the current fiscal year.

Dividend Announcement

Additionally, the company has announced a quarterly dividend, set to be distributed on January 2nd. Shareholders on record as of December 19th will receive a dividend of $0.13 per share. This translates to an annualized dividend of $0.52, yielding a 5.23% dividend rate, with a payout ratio of 66.67%.

Company Overview

Smith & Wesson Brands, Inc., a renowned name in the firearm industry, designs, manufactures, and markets firearms across the globe. The company specializes in a variety of products, including both handguns (such as revolvers and pistols) and long guns (like modern sporting rifles and bolt-action rifles), as well as outros firearm-related items like handcuffs and suppressors under their various brand names.

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