Smith & Wesson Brands Inc (SWBI) Stock Analysis
Verdict: WATCH (do not buy)
Cycle-peak valuation and declining margins outweigh revenue stability; legal headwinds and insider selling signal near-term exhaustion.
Investment score: 48/100
Analysis as of
Is Smith & Wesson Brands Inc stock worth reviewing? The TradeMates thesis
From the model's perspective, SWBI is an avoid due to a disconnect between its 51.5x P/E and deteriorating net margins (down to 2.47% from 4.6% operating). While the balance sheet is liquid (4.5x current ratio), negative free cash flow and recent legal setbacks at the Supreme Court level create too much uncertainty ahead of the June 17 earnings report.
7-factor investment score
- Valuation: 40/100 (weight 20%)
- Financial Health: 45/100 (weight 15%)
- Technical Momentum: 35/100 (weight 15%)
- Earnings Quality: 75/100 (weight 15%)
- Insider Sentiment: 30/100 (weight 10%)
- Analyst Consensus: 60/100 (weight 10%)
- Risk-Adjusted Return: 50/100 (weight 15%)
Smith & Wesson Brands Inc opportunities and risks
What speaks for SWBI
- Earnings Surprise Persistence
What speaks against SWBI
- Heightened Liability Litigation Risks
Peers and competitors
| Ticker | P/E | P/S | EV/EBITDA | Gross margin | Net margin | FCF yield |
|---|---|---|---|---|---|---|
| SWBI | 51.3x | 1.3x | 13.1x | 26.4% | 2.5% | 11.3% |
| CALY | 97.0x | 1.0x | 9.3x | 57.2% | 1.1% | 9.0% |
| PTON | 101.6x | 1.0x | 10.7x | 52.0% | 0.9% | 17.2% |
| TRON | 86.7x | 11.9x | n/a | 25.8% | 113.0% | -3.2% |
| SWIM | 74.1x | 1.2x | 7.3x | 33.8% | 1.5% | 2.9% |
| RGR | n/a | 1.1x | 91.0x | 14.4% | -2.2% | 7.0% |
| Peer median | 86.7x | 1.1x | 9.3x | 33.8% | 1.1% | 7.0% |
Frequently asked questions about Smith & Wesson Brands Inc (SWBI)
Is SWBI stock a good investment?
The TradeMates model rates Smith & Wesson Brands Inc as WATCH (do not buy) with an investment score of 48/100. From the model's perspective, SWBI is an avoid due to a disconnect between its 51.5x P/E and deteriorating net margins (down to 2.47% from 4.6% operating). While the balance sheet is liquid (4.5x current ratio), negative free cash flow and recent legal setbacks at the Supreme Court level create too much uncertainty ahead of the June 17 earnings report. This is algorithmic model output, not personal investment advice.
Is SWBI stock a buy?
The TradeMates model verdict for SWBI is WATCH (do not buy) with an investment score of 48/100. Treat this as a model signal to review, not a personal buy recommendation.