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Smith & Wesson (SWBI) Gains As Market Dips: What You Should Know

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In the latest trading session, Smith & Wesson (SWBI - Free Report) closed at $23.44, marking a +0.47% move from the previous day. This move outpaced the S&P 500's daily loss of 0.47%.

Prior to today's trading, shares of the firearm maker had lost 23.28% over the past month. This has lagged the Consumer Discretionary sector's loss of 4.3% and the S&P 500's gain of 3.38% in that time.

SWBI will be looking to display strength as it nears its next earnings release. In that report, analysts expect SWBI to post earnings of $1.26 per share. This would mark year-over-year growth of 29.9%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $296.2 million, up 6.56% from the year-ago period.

SWBI's full-year Zacks Consensus Estimates are calling for earnings of $4.40 per share and revenue of $903.4 million. These results would represent year-over-year changes of -3.08% and -18.41%, respectively.

It is also important to note the recent changes to analyst estimates for SWBI. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. SWBI is holding a Zacks Rank of #1 (Strong Buy) right now.

Investors should also note SWBI's current valuation metrics, including its Forward P/E ratio of 5.31. Its industry sports an average Forward P/E of 13.19, so we one might conclude that SWBI is trading at a discount comparatively.

The Leisure and Recreation Products industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 22, which puts it in the top 9% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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