Ruger, Cabela’s and the Winchester Ammunition division of Olin Corp are all doing very well reports EarningsWhispers via. Seeking Alpha …
The consensus revenue estimate for Ruger is $131.65 million, which represents sales growth of approximately 17% year-over-year; but that is likely much too conservative after what we’ve seen over the past week or so. For one, the FBI’s National Instant Criminal Background Check System [NICS] shows demand for firearms increased by 107% over the same period a year ago and last quarter Ruger said it gained market share and it sales outpaced the growth indicated by the background checks.
Another data point came from Olin (OLN). The company disappointed with its results last week, but that’s because Winchester sales make up only about a quarter of the total company. Winchester’s total sales increased by 27.5% and its commercial sales increased by 40%. The total sales growth was modestly better than last quarter when it reported total sales growth of 27.1%.
In addition, Cabela’s (CAB) reported same-store-sales growth of 24% last week and, when we back out other data, we get firearm and ammunition sales that seems to have increased by 40% as well. Last quarter Cabela’s same-store-sales growth was just 12%, so this showed a very solid acceleration in same-store-sales led by firearm sales during the quarter. This has a solid read-through for Big 5 Sporting Goods (BGFV), which reports after the close on Tuesday, April 30, 2013 and is expected to beat estimates. The consensus earnings estimate for Big 5 is $0.20 per share and the our number is $0.24 per share. However, the accelerating growth by both companies also suggests that Ruger’s sales outpaced the 52% growth it reported last quarter.
Based on Winchester’s commercial sales and Cabela’s same-store-sales as well as Ruger’s market share, 40% sales growth for Ruger is probably conservative, which would result in total revenue of approximately $155.0 million – well above the consensus estimate. This, in turn, would result in earnings of approximately $1.15 per share. The consensus earnings estimate is $1.04 per share.