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Smith & Wesson Holding Corporation Message Board

  • dontbetheball dontbetheball Mar 26, 2013 10:50 AM Flag

    Acquisition

    If it is accretive and management can sell the story, the market will support the stock.Biggest returns will come after the first quarter of consolidated earnings. The market has good reason to be skeptical about the ability of SWHC to integrate an acquisition. Personally, I have confidence in this new management team, as they have made all the right moves the last few years.

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    • This management team is doing very well. They seem very focused and are generating lots of cash. I hope they don't overpay for any acquisitions. If Freedom Groups wants to dump their stuff really cheap, then it would be a good use of cash to buy certain brands. Just don't overpay.

      Sentiment: Buy

      • 1 Reply to golfhacker49
      • GOLF! I think the price will be toned down due to the same overhang that besets the industry. There might be a provision in the purchase agreement that adjusts price in the event a draconian gun law is somehow (not very probable) put in place before a certain date. The poster that is implying dilution or dimunition in value is forgetting about all the added value and assets that come along with the deal. I think he/she is blowing alot of smoke. Someone posted last nite that any deal would be financed by debt/notes and that seems the way to go. The company is no way distressed and will have good pro-forma numbers - so I see the deal financing pretty straight up and close to market without any equity kickers.

    • Agree, but now shelf is almost 1/2 of Market Cap.
      And there will be no money made on this stock until one full quarter after consolidation. Thus, dead money for awhile and that's best case scenario.

      • 3 Replies to datbehardwork
      • Ris,
        Market Cap is now in high $500 million.
        Shelf registration is for $250 million. So almost 50% of market cap.
        Yes, hit is being taken because shelf wasn't priced. The lower the stock price goes the lower the Shelf price will eventually be. My guess is it will be priced 25-50 cents lower than the stock price the day it is announced. I.e., if priced toay it would be $8.60 to $8.85.
        Just my guess.

      • Excuse my ignorance, but could you explain to me this shelf of 50%. Ever since that last week we cant get going.
        I would appreciate an explanation and I thank you in advance.
        I do understand if we aquire a company, say Remington, it seems that the buying company takes an initial hit, so are we taking the hit before anything even happens.

      • dat...,
        IMO, less than one "full" quarter of consolidation. Next earnings release will generate some speculative buying and I don't think many shorts will hold through that earnings report; at least I wouldn't. GLTY!

 
SWHC
21.85+0.81(+3.85%)Feb 10 4:00 PMEST