Smith & Wesson Brands (NASDAQ:SWBI) and Vista Outdoor (NYSE:VSTO) are both small-cap consumer discretionary companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, profitability, valuation, earnings, dividends and risk.
Insider and Institutional Ownership
67.0% of Smith & Wesson Brands shares are owned by institutional investors. Comparatively, 92.9% of Vista Outdoor shares are owned by institutional investors. 2.7% of Smith & Wesson Brands shares are owned by company insiders. Comparatively, 1.3% of Vista Outdoor shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Volatility and Risk
Smith & Wesson Brands has a beta of 0.68, indicating that its stock price is 32% less volatile than the S&P 500. Comparatively, Vista Outdoor has a beta of 0.24, indicating that its stock price is 76% less volatile than the S&P 500.
This table compares Smith & Wesson Brands and Vista Outdoor’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Smith & Wesson Brands||-9.03%||10.26%||5.76%|
This is a summary of current ratings and target prices for Smith & Wesson Brands and Vista Outdoor, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Smith & Wesson Brands||0||1||2||0||2.67|
Smith & Wesson Brands currently has a consensus price target of $21.00, indicating a potential downside of 2.55%. Vista Outdoor has a consensus price target of $12.30, indicating a potential downside of 15.52%. Given Smith & Wesson Brands’ stronger consensus rating and higher possible upside, research analysts plainly believe Smith & Wesson Brands is more favorable than Vista Outdoor.
Valuation and Earnings
This table compares Smith & Wesson Brands and Vista Outdoor’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Smith & Wesson Brands||$678.39 million||1.76||-$61.23 million||$0.82||26.28|
|Vista Outdoor||$1.76 billion||0.48||-$155.08 million||$0.24||60.67|
Smith & Wesson Brands has higher earnings, but lower revenue than Vista Outdoor. Smith & Wesson Brands is trading at a lower price-to-earnings ratio than Vista Outdoor, indicating that it is currently the more affordable of the two stocks.
Smith & Wesson Brands beats Vista Outdoor on 9 of the 14 factors compared between the two stocks.
Smith & Wesson Brands Company Profile
Smith & Wesson Brands, Inc. is a holding company, which engages in the manufacture, design, and provision of firearms. It operates through the Firearms and Outdoor Products & Accessories segments. The Firearms segment comprises the manufacture of handguns, long guns, handcuffs, suppressors, and other firearm-related products for sale to a wide variety of customers. The Outdoor Products & Accessories segment engages in the distribution, manufacture, and design of reloading, gunsmithing, and gun cleaning supplies; stainless-steel cutting tools and accessories; flashlights; tree saws and related trimming accessories; shooting supplies, rests, and other related accessories; apparel; vault accessories; laser grips and laser sights; and a full range of products for survival and emergency preparedness. The company was founded by Michell A. Saltz on June 17, 1991 and is headquartered in Springfield, MA.
Vista Outdoor Company Profile
Vista Outdoor Inc. designs, manufactures, and markets consumer products for outdoor sports and recreation markets in the United States and internationally. The company operates through Outdoor Products and Shooting Sports segments. The Outdoor Products segment offer sports products for action sports, including helmets, goggles, and accessories for cycling, snow, action, and power sports; archery/hunting accessories, such as hunting arrows, game calls, hunting blinds, game cameras, and waterfowl decoys; outdoor cooking solutions for camping; eyewear and sport protection products, including safety and protective eyewear, and fashion and sports eyewear; golf products, such as laser rangefinders; hydration products comprising hydration packs and water bottles; optical products, such as binoculars, riflescopes, and telescopes; shooting accessories, including reloading equipment, clay targets, and premium gun care products; tactical products, such as holsters, duty gear, bags, and packs; and water sports products, including stand up paddle boards. The Shooting Sports segment designs, develops, produces, and sources ammunition and firearms for the hunting and sport shooting enthusiast markets, as well as ammunition for local law enforcement, the United States government, and international markets. This segment's product line includes centerfire ammunition, rimfire ammunition, shotshell ammunition, reloading components, and firearms. The company sells its products to outdoor enthusiasts, hunters and recreational shooters, athletes, and law enforcement and military professionals through various mass, specialty, and independent retailers and distributors. Vista Outdoor Inc. was incorporated in 2014 and is headquartered in Anoka, Minnesota.
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