Please ensure Javascript is enabled for purposes of website accessibility
Free Article Join Over 1 Million Premium Members And Get More In-Depth Stock Guidance and Research

ATK's Big Buyout Misses the Mark

By Rich Smith - May 20, 2013 at 1:59PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

ATK acquires Savage Arms owner Caliber Co -- but pays too much, and gets the wrong kind of growth.

Five months after the Sandy Hook shootings sent Wall Street scrambling away from anything having anything to do with guns, investors are starting to return to the sector. Last week, ATK  (NYSE: ATK) announced a deal to buy Savage Arms owner Caliber Co. for $315 million cash.

But issues of gun control and gun regulation aside, is this a good deal for ATK shareholders? Fool.com contributor Rich Smith doesn't think so. Among gun companies, he thinks either Smith & Wesson ( SWBI -28.72% ) or Sturm, Ruger ( RGR -9.84% ) are better bargains. And in ATK's case, there's a good case to be made against buying any gun companies at all...

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.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Smith & Wesson Brands, Inc. Stock Quote
Smith & Wesson Brands, Inc.
SWBI
$16.33 (-28.72%) $-6.58
Sturm, Ruger & Company, Inc. Stock Quote
Sturm, Ruger & Company, Inc.
RGR
$64.51 (-9.84%) $-7.04

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
624%
 
S&P 500 Returns
141%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 12/04/2021.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Our Most Popular Articles

Premium Investing Services

Invest better with the Motley Fool. Get stock recommendations, portfolio guidance, and more from the Motley Fool's premium services.