The 10-second takeaway
For the quarter ended June 29 (Q2), Sturm, Ruger beat expectations on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue grew significantly. GAAP earnings per share increased significantly.
Margins increased across the board.
Sturm, Ruger booked revenue of $179.5 million. The one analyst polled by S&P Capital IQ expected sales of $154.7 million on the same basis. GAAP reported sales were 50% higher than the prior-year quarter's $119.6 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures are normalized by S&P Capital IQ and may vary to maintain comparability with normalized estimates.
EPS came in at $1.63. The one earnings estimate compiled by S&P Capital IQ predicted $1.18 per share. GAAP EPS of $1.63 for Q2 were 79% higher than the prior-year quarter's $0.91 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures are normalized by S&P Capital IQ and may vary to maintain comparability with normalized estimates.
For the quarter, gross margin was 39.4%, 170 basis points better than the prior-year quarter. Operating margin was 28.3%, 460 basis points better than the prior-year quarter. Net margin was 18.0%, 290 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $137.6 million. On the bottom line, the average EPS estimate is $0.94.
Next year's average estimate for revenue is $584.6 million. The average EPS estimate is $4.20.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 636 members out of 676 rating the stock outperform, and 40 members rating it underperform. Among 182 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 177 give Sturm, Ruger a green thumbs-up, and five give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Sturm, Ruger is underperform, with an average price target of $40.00.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month. The Motley Fool owns shares of Sturm, Ruger & Company. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.