Smith and Wesson reported that its sales returned to the prepandemic normal for the quarter ending in October, which is still profitable for the company. The drop in sales echoed ones reported by Sturm, Ruger, and other manufacturers and is the second consecutive quarter of slumping sales. This caused the company’s stock price to plunge to a 52 week low- from $14.39 a share in August down to $9.49 this morning.
I pulled out of the stock market last October, when it became obvious that things were going south. I resumed buying stock in July, and am picking up anything that looks like a healthy company but whose stock is selling at fire sale prices. Royal Caribbean Cruise lines is one, and now Smith and Wesson is added to that list. The company is still sound and is still turning a profit. When there is blood in the streets, buy oil. So that’s what I did- I picked up 100 shares. Maybe I will get some more before the stock recovers. I am betting that it will bounce back as inflation cools. If inflation DOESN’T cool, then money will be worthless anyhow.
I did the same thing in 2020 and made a shitload of money on Royal Caribbean and on Darden Restaurants. I bought RCL at $21 a share, then sold it 8 months later for $80 a share. I bought DRI at $50 a share then sold at $115. I made almost $50,000 in 8 months on those two deals when I turned $30K into over $75k.
My recommendation? If you have some spare investing money, find a deal on a stock. They are going to bounce back in a year or so, and you will make some decent returns. There are plenty of reputable stock purchasing companies that will let you buy stock direct with no commissions. I use ETrade.
******** As usual, the disclaimer: I don’t advertise, and receive nothing for my reviews or articles. I have no relationship with any products, companies, or vendors that I review here, other than being a customer. I pay what you would pay. I only post these things because I think that my readers would be interested.