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American Outdoor Brands (AOBC) Completes LaserLyte Buyout

Zacks Equity Research

American Outdoor Brands Corporation AOBC recently announced that its Electro-Optics Division — Crimson Trace Corp. — has completed the acquisition of LaserLyte, which is a provider of laser training and sighting products for the consumer market.    

Benefits of the Deal

LaserLyte is a renowned manufacturer of innovative laser training and sighting products, which cover a range of applications including non-live fire firearms training, sighting in rifle scopes and optics, and entertainment.  No doubt adding LaserLyte's firearm training systems, laser sights and bore sights to American Outdoor Brands will complement the acquirer’s existing offering.

This would enable American Outdoor Brands to expand its footprint in the electro-optics market, worth a $2.9 billion.

Focus on Crimson Trace

American Outdoor Brands acquired Crimson Trace to utilize its strong brand name. Crimson Trace has been enjoying a dominant position in the laser sighting market for long and we believe the latest acquisition of LaserLyte will enable it to retain that position, in days ahead. This in turn should expand customer base for American Outdoor Brands, thereby boosting its profit margin.

Price Performance

Shares of American Outdoor Brands have increased about 9.6% in a year, against the industry’s decline of 4.1%.


Zacks Rank & Other Key Picks

American Outdoor Brands currently carries a Zacks Rank #2 (Buy). A few other top-ranked stocks in the same sector are AeroVironment, Inc AVAV, Esterline Technologies Corp. ESL  and Aerojet Rocketdyne Holdings, Inc. AJRD. AeroVironment and Esterline Technologies sport a Zacks Rank #1 (Strong Buy), while Aerojet Rocketdyne carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

AeroVironment pulled off an average earnings surprise of 257.01% in the trailing four quarters. The Zacks Consensus Estimate for 2019 earnings moved up 4.7% to $1.56 in the past 90 days.

Esterline Technologies came up with an average positive surprise of 22.93% in the last four quarters. The Zacks Consensus Estimate for 2019 earnings inched up 1.07% upward to $4.70 in the past 90 days.

Aerojet Rocketdyne pulled off an average earnings surprise of 19.27% in the trailing four quarters. The Zacks Consensus Estimate for 2019 earnings moved up 9.8% to $1.46 in the past 90 days.

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