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Smith & Wesson Holding Corporation Message Board

llllorac 446 posts  |  Last Activity: 4 minutes 39 seconds ago Member since: Feb 17, 2000
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  • They peak when future news can't get any better. Scott Hamann forecasted in Oct '12 that the gun stock news couldn't get better. He was wrong. It did. But the question is, "was he wrong permanently or just early"? Much is discussed on this and the SWHC board about PEG ratios, profit margins, order backlog, takeover prospects... None of that will matter if you hear a few simple words out of Fifer or Debney's mouths..."we are starting to see a falloff in demand"....I think they have been trying to prepare us for it by reminding us the immediate past was not "normal" times. I believe there is a lot of money betting there will be less than encouraging news coming. If it doesn't come, there will be a healthy rally..if it does, I'd be looking for another 10-20% haircut. now get back to the pep rally going on this board.

  • This is why using margin with stocks most often ends in disaster...when trouble happens, the leveraged investor is forced to re-act at the worst possible time. In the case of SWHC, mgts borrowing $100 mil to buy back stock at a bit over $11 seemed brilliant. It even helped facilitate some executive sales of some stock at prices far above that. I'm happy to have averaged a bit over $15 myself on the position I held patiently for an average holding period of a little over 2 years. So when I recommended lightening up at $15 a while back, most everyone on this board turned on me like a pack of wolves. It appears this board is just a juvenile pep rally site not a place to actually share investment ideas. Getting back to the "prepare for the worst" concept. When management borrowed money to buy back stock they essentially went on "margin". What do you think the impact will be to financial health of SWHC should the stock fall below $11? I'd be thinking about that if I owned SWHC ON MARGIN. What do they do? Borrow another $100 mil to buy back more to support the stock?

  • Sighting falling ratings and specifically mentioning Piers's anti gun position as a contributing factor, he's being dumped. Ted Nugent must be laughing his ars off. I know I am. He might even have a tit in the wringer in connection with his last gig at the gossip rag in Britain. Deport him....

  • It was just announced that CNN plans to cancel Piers Morgan's show, specifically mentioning his anti gun position as having played a part in his plunging ratings. The uber lib's problems don't end there, apparently he's got a few skeletons in his closet from his last gig at the gossip rag he worked at in the U.K. He's being questioned by British police in regards to the phone hacking scandal over there. He might not be deported. He might be extradited .

  • Reply to

    Hope for the best but plan for the worst....

    by llllorac Feb 24, 2014 1:38 AM
    llllorac llllorac Feb 24, 2014 10:13 AM Flag

    They borrowed money to buy stock back in while executives were selling theirs. It is questionable at the very least.

  • Reply to

    Short Interest

    by ewcep Feb 24, 2014 10:48 AM
    llllorac llllorac Feb 24, 2014 11:22 AM Flag

    If the guidance is upbeat tomorrow there will be a nice rally....the shorts are betting against it..if RGR misses and more importantly guide below previous expectations, then Hamanns scenario plays out..look out below... His warning was so premature he can never take credit for being right on this stock but I believe his original concerns about it are sound. The stock is in an unsustainable growth period. It has gone on for longer than Hamann believed possible. IMHO this could be the quarter where mgt starts to "own up" to it....tomorrow's CC guidance is crucial.

  • Reply to

    Short Interest

    by ewcep Feb 24, 2014 10:48 AM
    llllorac llllorac Feb 24, 2014 12:13 PM Flag

    Ruger, like many other companies doesn't provide an eps forecast. They provide enough information to let a rookie analyst conclude what the trend is however..."IF" you here "we are starting to see a softness in demand" it will re-enforce Cabelas warning and it's "game over" for the stock. "If" you hear that business is continuing as strong as ever, the stock should rally hard. It is a crucial moment for both RGR and SWHC stocks..

  • Reply to

    Short Interest

    by ewcep Feb 24, 2014 10:48 AM
    llllorac llllorac Feb 24, 2014 2:19 PM Flag

    It's only anecdotal evidence but as a gun buyer myself I am selling discounting if previously impossible to get CC guns both from Ruger And Smith. This plus direct evidence from Cabelas and D*cks makes me wonder if the distribution channel would want to hold smaller inventory going forward. The quarter where this first happens will be a miss. The market may take it in stride. It may not. I think both companies are healthy, less impressed with the guys on the board of Smith, but the sticks don't always reflect the long term prospects of a company. Lots of money in the market is using a stop watch not a calendar.

  • Reply to

    Short Interest

    by ewcep Feb 24, 2014 10:48 AM
    llllorac llllorac Feb 24, 2014 2:21 PM Flag

    I am SEEING discounting....

  • Reply to

    Supreme Court declines challenges to gun laws

    by captainwho2 Feb 24, 2014 1:53 PM
    llllorac llllorac Feb 24, 2014 2:28 PM Flag

    The biggest threat we have from Obama is that he has 3 more years to appoint justices to Federal courts and possible Supreme Court justices. The conservative judges better have food tasters.

  • 00 buck was in very high demand not that long ago. Have seen some store discounting for a while and now manufacturer discounting.

  • llllorac llllorac Feb 24, 2014 5:30 PM Flag

    I'd be more concerned about love being blind.

  • Reply to

    There were many warnings...but love is blind.

    by llllorac Feb 24, 2014 6:34 PM
    llllorac llllorac Feb 24, 2014 7:06 PM Flag

    $80 on RGR and $15 on SWHC look pretty good right now.....and SLW which I recommended at the same time went up 20%.....what so you want?

  • llllorac llllorac Feb 24, 2014 7:43 PM Flag

    I'll tell you what, I'm looking to buy a M&P pro series 9mm for 3 gun comp when I get back to Mich. through S&W's dealer search site I found a dealer near me who has one for sale $100 off....that worries me about demand. Happy to see it as a gun buyer though.

  • llllorac llllorac Feb 24, 2014 7:50 PM Flag

    The stock action is telling us there will be a disappointment of some kind. I'm not sure what that will be. My guess is that they admit to a slowing in orders from distributors who don't want to get caught with excess inventory as prices start to see discounting.

  • llllorac llllorac Feb 24, 2014 8:44 PM Flag

    The smart money got out on the last good news coupled with a short squeeze . Now I'm tooting my own horn here but you very well know I announced to both boards when I sold my positions in both stocks ($80 and $15)and why...those who didn't were looking for more. Now hope is turning to despair and greed is turning to fear... There are and will continue to be margin issues here as we'll. what's the worst thing that can happen here ? I suggested asking yourself weeks ago? It's happening.

  • llllorac llllorac Feb 24, 2014 9:06 PM Flag

    Here is where we disagree: while I believe gun sales will continue to be strong, I believe the growth in sales (rate of increase) has been declining and we may be near a leveling off or even a small decline. Now while this is perfectly fine for RGR and SWHC as being profitable gun companies, it will be disaster for the stock prices which are looking for growing earnings. The growth rates were so high that it was highly improbable it would be sustainable. Hamann forecasted this but was over a year early IMHO....there is a second issue I worry about. No public company that I know of has managed to keep margins as high as these two companies have....there is significant competition in this space which makes it even less plausible..I see an increase in capex ahead. Game over for the stocks when they start allocating serious money for direct advertising.

  • llllorac llllorac Feb 24, 2014 9:37 PM Flag

    I'm a big S&W fan but trying to explain why I believe the stock is declining. I never lived outside of MI but spend my winters in AZ...(didn't understand the reference of the other states). there are two problems as I see it. Sales are leveling off and there will margin compression going forward. Increased capex for one thing. Impossible to keep margins this high indefinitely. Stocks rise and fall based on changes in "rates of change" don't get paid a nickel for figuring out what's already happened and that's almost never the case.....another thing.....Don't let your political and personal convictions cloud your investment decisions.

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