Forget the necktie -- give Dad something he can really use this year. We're serving up plenty of Foolish ideas to help you out.

Not so long ago, it was a rite of passage for a son to receive from his father a cherished family heirloom: either a hunting rifle or a handgun.

When I turned 13, my father gave me my first .22-caliber rifle and enrolled me in a National Rifle Association safety course. While I used the rifle occasionally to shoot woodchucks on my grandmother's farm, more often than not I would simply go plinking tin cans. I still have that rifle and cherish those times shooting with my dad.

Today, though, a gun is too often seen solely as a liability. Where my grandmother had hundreds of acres I could roam with my rifle in solitude, today's urban and suburban areas offer precious few places where a boy and his dad can safely go shooting together.

Yet firearms are still a viable form of recreation for millions of individuals. So this Father's Day, if you don't have the opportunity to return the favor and give Dad some cold hard steel, consider giving him some stock in a company that still makes those happy memories: Smith & Wesson (NASDAQ:SWHC).

Go ahead, make Dad's day
The history of the company, founded in 1852 by Horace Smith and Daniel Wesson, is inextricably entwined in the fabric of this country's own history, along with that of privately held Colt's Manufacturing. Yet even if Smith & Wesson is best known today for the .44 Magnum that Clint Eastwood unloaded into perps in the Dirty Harry movies, a storied past, no matter how interesting, doesn't make for a good investment. What does, however, is an ability to generate sales and profits, and Smith & Wesson has been doing just that.

Protecting the protectors
Handguns comprise 75% of Smith & Wesson's fiscal 2006 revenue (excluding those from its Walther subsidiary). Pistol revenue rose more than 59% for the year, primarily in the most recent quarter, largely on the strength of sales to the military and police agencies. Law enforcement sales rose 135% over the year before. The company's new polymer pistol line, introduced just a year ago, has been extremely popular.

The strength in handgun sales that Smith & Wesson is witnessing seems to be the direct opposite of the trends being seen at Sturm Ruger (NYSE:RGR), one of the few other publicly traded gun manufacturers. Ruger reported in March that 2006 sales grew by 8%, but that may have been caused by customers pushing up sales of its castings products, which it is phasing out. Handgun sales, which make up 80% of Ruger's revenue, fell 4% in the fiscal fourth quarter.

There's a lot of competition for sales to the military and police. Aside from Smith & Wesson and Ruger, a number of foreign manufacturers vie for a spot on the gun belts of those protecting us. Baretta, Sig Sauer, Glock, and Browning are just a few of the names you'll find in the holster. Taser (NASDAQ:TASR), while selling into the same market, is more of a supplemental weapon than a competitor in the available arsenal.

A long reach into long arms
Profits are also improving. Smith & Wesson had to take non-cash charges for its acquisition of Thompson/Center Arms, which hit its financials. If you exclude those extraordinary charges, however, gross profits rose to 33.6%, almost 5 percentage points higher than the year before. Net income, despite the acquisition charges, doubled to $0.04 per share and would have been about $0.07 per share without the expense.

With the Thompson acquisition, Smith & Wesson is now a part of the hunting rifle market. Rifles only accounted for 1% of 2006 revenue, and the new division should help boost those numbers going forward. At $1 billion, the market for long guns is estimated to be twice the size of that for handguns.

The company was also recently featured as one of Business Week Online's "Hot Growth Stocks of 2007," and of the five analysts covering the stock, four of them rate it a buy. While Fools generally pay little attention to Wall Street's game of "Buy-Sell-Hold," there seems to be good reason for the enthusiasm underlying the market's sentiment about the gun maker. We can't ignore, though, that Smith & Wesson's stock has doubled over the past year, and the market values it at more than 49 times last year's earnings and 24 times forward estimates -- even if its better operating performance justifies it.

This Father's Day, sharing in shares of Smith & Wesson stock -- even if you can't get to the range or the field with a Smith & Wesson gun -- is still a way to partake in a longtime family tradition.

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Fool contributor Rich Duprey does not have a financial position in any of the stocks mentioned in this article. You can see his holdings here. The Motley Fool has a disclosure policy.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.