American Outdoor Brands (AOB) stock jumped nearly 10 percent today as company executives announced massive quarterly sales that far exceeded the predictions of forecasters. Company executives believe the interest in their company’s products represents a permanent change in Americans’ stance towards outdoor sports.
Analysts had forecasted that AOB would earn just $0.25 per share, pro forma, in fiscal Q2 on sales of $61 million. Instead, the company reported last night that Q2 earnings were $0.77 on sales of $79.1 million. What’s more, the company reported that quarterly net sales were $79.1 million, an increase of $31.4 million, or 65.7%, over net sales of $47.7 million for the comparable quarter last year.
“I’m happy to report that during the quarter, we experienced growth across nearly all of our 20 brands and within each of the major activities we serve. In fact, nearly half of our brands experienced triple-digit sales growth in the quarter,” CEO Brian Murphy said on a call with investors.
Murphy believes the sales increase has been driven largely by an increased interest in outdoor sports spurred by the COVID-19 pandemic. He cited evidence that more Americans are camping, fishing, and participating in shooting sports, and he believes these numbers represent a new normal in the country.
“In general, we believe we are witnessing a new higher foundational level of consumer participation in outdoor activities, responsible firearms ownership and adjacent home-based hobbies that surround outdoor adventure,” he said.
American Outdoor Brands is the parent company for a host of brands familiar to gun owners, including Thompson/Center, Uncle Henry, Caldwell, Tipton, Wheeler, Crimson Trace, and Lockdown.
The company grabbed negative headlines in the firearms community last year when they decided to break away from Smith & Wesson, which had formerly been the AOB’s flagship brand. Smith & Wesson formed its own publicly traded company, Smith & Wesson Brands, Inc., which incorporated all the firearms brands formerly under AOB. Some critics accused AOB of caving to anti-gun activists and investors by separating themselves from Smith & Wesson.
The move appears to have paid off, but there’s evidence to suggest that the company could be even more profitable if they hadn’t split with the gun maker. Smith & Wesson Brand Inc’s stock has risen this year from a low point of $4.57 per share in March to $17 per share today, a 372 percent increase. Smith & Wesson’s stock price also jumped up this week, driven by Joe Biden’s victory in the electoral college vote, according to analysts.