NasdaqGS:AOBC

Stock Analysis Report

Executive Summary

American Outdoor Brands Corporation designs, manufactures, and sells firearms worldwide.

Rewards

Trading at 44.3% below its fair value

Earnings are forecast to grow 82.74% per year

Risk Analysis

Interest payments are not well covered by earnings

Large one-off items impacting financial results

Profit margins (0.5%) are lower than last year (5.3%)



Snowflake Analysis

Fair value with moderate growth potential.


Similar Companies

Share Price & News

How has American Outdoor Brands's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: AOBC has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

3.1%

AOBC

1.6%

US Leisure

0.9%

US Market


1 Year Return

-19.4%

AOBC

11.2%

US Leisure

20.0%

US Market

Return vs Industry: AOBC underperformed the US Leisure industry which returned 11.6% over the past year.

Return vs Market: AOBC underperformed the US Market which returned 20.1% over the past year.


Shareholder returns

AOBCIndustryMarket
7 Day3.1%1.6%0.9%
30 Day8.2%-0.02%1.4%
90 Day21.7%3.6%8.8%
1 Year-19.4%-19.4%13.0%11.2%22.5%20.0%
3 Year-46.9%-46.9%-0.2%-5.1%49.9%40.3%
5 Year-20.4%-20.4%3.3%-6.4%73.2%54.1%

Price Volatility Vs. Market

How volatile is American Outdoor Brands's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is American Outdoor Brands undervalued compared to its fair value and its price relative to the market?

44.3%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: AOBC ($10.21) is trading below our estimate of fair value ($18.32)

Significantly Below Fair Value: AOBC is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: AOBC is poor value based on its PE Ratio (170x) compared to the Leisure industry average (20.2x).

PE vs Market: AOBC is poor value based on its PE Ratio (170x) compared to the US market (18.4x).


Price to Earnings Growth Ratio

PEG Ratio: AOBC is poor value based on its PEG Ratio (2.1x)


Price to Book Ratio

PB vs Industry: AOBC is good value based on its PB Ratio (1.3x) compared to the US Leisure industry average (3x).


Next Steps

Future Growth

How is American Outdoor Brands forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

82.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: AOBC's forecast earnings growth (82.7% per year) is above the savings rate (1.7%).

Earnings vs Market: AOBC's earnings (82.7% per year) are forecast to grow faster than the US market (14.6% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: AOBC's revenue (6.4% per year) is forecast to grow slower than the US market (7.6% per year).

High Growth Revenue: AOBC's revenue (6.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if AOBC's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has American Outdoor Brands performed over the past 5 years?

-22.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: AOBC has a large one-off loss of $10.5M impacting its October 31 2019 financial results.

Growing Profit Margin: AOBC's current net profit margins (0.5%) are lower than last year (5.3%).


Past Earnings Growth Analysis

Earnings Trend: AOBC's earnings have declined by -22.1% per year over the past 5 years.

Accelerating Growth: AOBC's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: AOBC had negative earnings growth (-90.2%) over the past year, making it difficult to compare to the Leisure industry average (-3.4%).


Return on Equity

High ROE: AOBC's Return on Equity (0.7%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is American Outdoor Brands's financial position?


Financial Position Analysis

Short Term Liabilities: AOBC's short term assets ($353.1M) exceed its short term liabilities ($170.2M).

Long Term Liabilities: AOBC's short term assets ($353.1M) exceed its long term liabilities ($192.0M).


Debt to Equity History and Analysis

Debt Level: AOBC's debt to equity ratio (45.4%) is considered high.

Reducing Debt: AOBC's debt to equity ratio has reduced from 106.4% to 45.4% over the past 5 years.

Debt Coverage: AOBC's debt is not well covered by operating cash flow (6.8%).

Interest Coverage: AOBC's interest payments on its debt are not well covered by EBIT (2.8x coverage).


Balance Sheet

Inventory Level: AOBC has a high level of physical assets or inventory.

Debt Coverage by Assets: AOBC's debt is covered by short term assets (assets are 1.7x debt).


Next Steps

Dividend

What is American Outdoor Brands's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage2.3%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate AOBC's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate AOBC's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if AOBC's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if AOBC's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of AOBC's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

8.3yrs

Average management tenure


CEO

P. Debney (51yo)

8.4yrs

Tenure

US$3,759,023

Compensation

Mr. P. James Debney has been the Chief Executive Officer and President of American Outdoor Brands Corp. (formerly, Smith & Wesson Holding Corporation) since September 27, 2011 and has been its Director sin ...


CEO Compensation Analysis

Compensation vs Market: P.'s total compensation ($USD3.76M) is above average for companies of similar size in the US market ($USD1.68M).

Compensation vs Earnings: P.'s compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
P. Debney
President8.4yrsUS$3.76m0.68% $3.8m
Mark Smith
Co-President0.08yrsUS$1.14m0.051% $284.1k
Brian Murphy
Co-President0.08yrsUS$899.83k0.039% $219.1k
Jeffrey Buchanan
Executive VP9.1yrsUS$1.62m0.15% $861.3k
Robert Cicero
Senior VP8.3yrsUS$1.15m0.052% $293.7k
John Dineen
Chief Information Officer0yrsUS$329.00kno data
Elizabeth Sharp
Vice President of Investor Relations14.8yrsno datano data
Lane Tobiassen
President of the Firearms Division3.5yrsno data0.028% $155.8k
Deana McPherson
VP & Corporate Controller12.7yrsno data0.037% $208.6k
Lewis Hornsby
President of Logistics & Customer Service Division2.7yrsno datano data

8.3yrs

Average Tenure

51yo

Average Age

Experienced Management: AOBC's management team is seasoned and experienced (8.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
P. Debney
President8.4yrsUS$3.76m0.68% $3.8m
Barry Monheit
Chairman of the Board15.3yrsUS$207.82k0.094% $527.5k
Mitchell Saltz
Independent Director21.3yrsUS$171.52k0.13% $707.8k
Robert Scott
Vice Chairman of the Board 0yrsUS$205.14k0.11% $611.2k
Anita Britt
Independent Director2yrsUS$165.01k0.017% $97.1k
John Furman
Independent Director15.8yrsUS$192.50k0.051% $289.3k
Marie Wadecki
Independent Director17.4yrsUS$186.00k0.069% $389.0k
Michael Golden
Independent Director15.2yrsUS$155.00k0.45% $2.5m
Gregory Gluchowski
Independent Director4.7yrsUS$165.00k0.036% $199.8k

15.2yrs

Average Tenure

66yo

Average Age

Experienced Board: AOBC's board of directors are seasoned and experienced ( 15.2 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

American Outdoor Brands Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: American Outdoor Brands Corporation
  • Ticker: AOBC
  • Exchange: NasdaqGS
  • Founded: 1852
  • Industry: Leisure Products
  • Sector: Consumer Durables
  • Market Cap: US$562.173m
  • Shares outstanding: 55.06m
  • Website: https://www.aob.com

Number of Employees


Location

  • American Outdoor Brands Corporation
  • 2100 Roosevelt Avenue
  • Springfield
  • Massachusetts
  • 1104
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
AOBCNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDApr 2000
SWSDB (Deutsche Boerse AG)YesCommon StockDEEURApr 2000
0HEMLSE (London Stock Exchange)YesCommon StockGBUSDApr 2000

Biography

American Outdoor Brands Corporation designs, manufactures, and sells firearms worldwide. The company’s Firearms segment offers handguns, long guns, handcuffs, suppressors, and other firearm-related products under the Smith & Wesson, M&P, Performance Center, Thompson/Center Arms, and Gemtech brands. It also provides manufacturing services to other businesses under the Smith & Wesson and Smith & Wesson Precision Components brands; and sells parts purchased through third parties. This segment sells its products to shooting and outdoor enthusiasts, collectors, sportsmen, competitive shooters, hunters, individuals desiring home and personal protection, law enforcement and military personnel and agencies, and other government organizations. The company’s Outdoor Products & Accessories segment offers 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 products for survival and emergency preparedness, as well as other products. It provides its products under the Caldwell, Wheeler, Tipton, Frankford Arsenal, Lockdown, Hooyman, BOG, Crimson Trace, Imperial, Schrade, Old Timer, Uncle Henry, BUBBA, LaserLyte, Smith & Wesson, M&P, Performance Center, Thompson/Center, UST, and KeyGear brands. The company markets its products through independent dealers, retailers, in-store retails, and direct to consumers; print, broadcast, and digital advertising campaigns; social and electronic media; in-store retail merchandising strategies; and Websites and online retail stores. The company was formerly known as Smith & Wesson Holding Corporation and changed its name to American Outdoor Brands Corporation in January 2017. The company was founded in 1852 and is based in Springfield, Massachusetts. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/17 23:47
End of Day Share Price2020/02/14 00:00
Earnings2019/10/31
Annual Earnings2019/04/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.