Leading publicly traded U.S. firearms maker, Sturm, Ruger & Company, Inc.’s (RGR - Free Report) second-quarter 2017 earnings of 57 cents per share missed the Zacks Consensus Estimate of $1.11 by 48.6%.
The bottom line was also down 53.3% from the year-ago figure of $1.22. The decline was primarily due to decrease in sales, the unfavorable de-leveraging of fixed manufacturing costs owing to the fall in production volumes, and $2.5 million expenses related to the recall of Mark IV pistols.
Revenues
The company reported revenues of $131.9 million in the reported quarter, down 21.4% from the prior-year figure of $167.9 million. The top line also missed the Zacks Consensus Estimate of $160 million by 17.6%.
The decline in year-over-year performance can be attributed to lower firearm and casting sales.
While firearm sales (comprising 99% of total sales) declined 21.5%, castings sales dropped 17.7%. Notably, new product sales accounted for 29% of total firearm sales in the second quarter.
Dividend
Sturm, Ruger declared a second-quarter dividend of 23 cents per share, payable on Aug 31 to shareholders of record as of Aug 15, 2017. The dividend represents about 40% of the company’s net income.
Per management, dividend payouts vary every quarter as they are based on a percentage of earnings rather than a fixed amount.
Operational Highlights
Gross profit plunged 38.4% to $34.9 million from $56.7 million in the year-ago quarter.
Total operating expenses fell 2.8% to $19.7 million in the quarter due to lower selling, general and administrative expenses. Operating income was also down 58% to $15.3 million from $36.5 million in the second quarter of 2016.
Sturm, Ruger’s earnings before interest, taxes, and depreciation and amortization in the reported quarter was $25 million, down 44.6%.
Financial Performance
Sturm, Ruger ended the second quarter with $44 million cash compared with $87.1 million at 2016 end.
Cash generated from operations was approximately $39.9 million in the first half of 2017 compared with $66.1 million a year ago. The current ratio is 2.7 to 1, with no outstanding debt.
Capital expenditure was $10.9 million at the end of the first six months of the year. The company expects capital expenditure of about $35 million in 2017.
Sturm, Ruger returned $16.3 million to its shareholders through dividend payments during the first half of 2017. Also, the company repurchased 1.1 million of its common stocks for $53.5 million.
Peer Releases
Brunswick Corporation’s (BC - Free Report) second-quarter earnings of $1.35 per share surpassed the Zacks Consensus Estimate of $1.33 by 1.5%. Also, the figure rose 13.4% on a year-over-year basis.
Pool Corporation’s (POOL - Free Report) second-quarter earnings of $2.21 per share missed the Zacks Consensus Estimate of $2.24 by 1.3%. However, the figure rose 12% on a year-over-year basis.
Escalade, Incorporated (ESCA - Free Report) reported second-quarter adjusted earnings of 15 cents per share, missing the Zacks Consensus Estimate of 23 cents by 34.8%. However, earnings were in line with the year-ago figure.
Zacks Rank
Sturm, Ruger currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Leading publicly traded U.S. firearms maker, Sturm, Ruger & Company, Inc.’s (RGR - Free Report) second-quarter 2017 earnings of 57 cents per share missed the Zacks Consensus Estimate of $1.11 by 48.6%.
The bottom line was also down 53.3% from the year-ago figure of $1.22. The decline was primarily due to decrease in sales, the unfavorable de-leveraging of fixed manufacturing costs owing to the fall in production volumes, and $2.5 million expenses related to the recall of Mark IV pistols.
Revenues
The company reported revenues of $131.9 million in the reported quarter, down 21.4% from the prior-year figure of $167.9 million. The top line also missed the Zacks Consensus Estimate of $160 million by 17.6%.
The decline in year-over-year performance can be attributed to lower firearm and casting sales.
While firearm sales (comprising 99% of total sales) declined 21.5%, castings sales dropped 17.7%. Notably, new product sales accounted for 29% of total firearm sales in the second quarter.
Dividend
Sturm, Ruger declared a second-quarter dividend of 23 cents per share, payable on Aug 31 to shareholders of record as of Aug 15, 2017. The dividend represents about 40% of the company’s net income.
Per management, dividend payouts vary every quarter as they are based on a percentage of earnings rather than a fixed amount.
Operational Highlights
Gross profit plunged 38.4% to $34.9 million from $56.7 million in the year-ago quarter.
Total operating expenses fell 2.8% to $19.7 million in the quarter due to lower selling, general and administrative expenses. Operating income was also down 58% to $15.3 million from $36.5 million in the second quarter of 2016.
Sturm, Ruger’s earnings before interest, taxes, and depreciation and amortization in the reported quarter was $25 million, down 44.6%.
Financial Performance
Sturm, Ruger ended the second quarter with $44 million cash compared with $87.1 million at 2016 end.
Cash generated from operations was approximately $39.9 million in the first half of 2017 compared with $66.1 million a year ago. The current ratio is 2.7 to 1, with no outstanding debt.
Capital expenditure was $10.9 million at the end of the first six months of the year. The company expects capital expenditure of about $35 million in 2017.
Sturm, Ruger returned $16.3 million to its shareholders through dividend payments during the first half of 2017. Also, the company repurchased 1.1 million of its common stocks for $53.5 million.
Peer Releases
Brunswick Corporation’s (BC - Free Report) second-quarter earnings of $1.35 per share surpassed the Zacks Consensus Estimate of $1.33 by 1.5%. Also, the figure rose 13.4% on a year-over-year basis.
Pool Corporation’s (POOL - Free Report) second-quarter earnings of $2.21 per share missed the Zacks Consensus Estimate of $2.24 by 1.3%. However, the figure rose 12% on a year-over-year basis.
Escalade, Incorporated (ESCA - Free Report) reported second-quarter adjusted earnings of 15 cents per share, missing the Zacks Consensus Estimate of 23 cents by 34.8%. However, earnings were in line with the year-ago figure.
Zacks Rank
Sturm, Ruger currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
More Stock News: Tech Opportunity Worth $386 Billion in 2017
From driverless cars to artificial intelligence, we've seen an unsurpassed growth of high-tech products in recent months. Yesterday's science-fiction is becoming today's reality. Despite all the innovation, there is a single component no tech company can survive without. Demand for this critical device will reach $387 billion this year alone, and it's likely to grow even faster in the future.
Zacks has released a brand-new Special Report to help you take advantage of this exciting investment opportunity. Most importantly, it reveals 4 stocks with massive profit potential. See these stocks now>>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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