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Smith & Wesson (SWBI) Soars 17.2%: Is Further Upside Left in the Stock?

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Smith & Wesson (SWBI - Free Report) shares ended the last trading session 17.2% higher at $23.35. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 1.7% gain over the past four weeks.

Shares of Smith & Wesson brand jumped after the company posted better-than-expected fourth quarter fiscal 2021 results, with earnings and revenues surpassing the Zacks Consensus Estimate. Notably, positive investor sentiments were witnessed as the company boosted its market share through increased productivity from manufacturing and logistics teams. This along with, announcements such as increment in quarterly dividend by 60% and authorization of a new $50 million share repurchase program are likely to have driven the stock higher.

This firearm maker is expected to post quarterly earnings of $1 per share in its upcoming report, which represents a year-over-year change of +3.1%. Revenues are expected to be $261.5 million, down 5.9% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For Smith & Wesson, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on SWBI going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank 1 (Strong Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

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