American Outdoor Brands reported 1Q earnings of $0.36 per share, better than analysts’ loss estimates of $0.30 per share and year-ago loss of $0.09. Its revenue came in at $50.5 million, higher than the Street estimates of $41.5 million. Despite better-than-expected 1Q results (ending on July 31), AOUT shares dropped 3.94% on Friday due to the broader market sell off.
American Outdoor’s (AOUT) revenues jumped 51.9% year-over-year driven by higher e-commerce and traditional sales. The provider of outdoor products and accessories reported e-commerce sales growth of 130%, while traditional sales surged 15% in 1Q. AOUT’s CFO Andrew Fulmer said, “Increased net sales in the quarter benefited, in part, from an initiative we began in fiscal 2020 to migrate certain retail customers from lumpy, ‘bulk buy’ ordering to a more balanced approach.”
The company has raised its guidance for FY21. It now expects sales in the range of $195 to $205 million and adjusted earnings in the range of $0.78 to $0.89 per share for the year. (See AOUT stock analysis on TipRanks).
On Sept. 4, Lake Street analyst Mark Smith raised the price target on American Outdoor Brands to $23 (57.2% upside potential) from $21. He maintained a Buy rating on the stock after the “strong” sales momentum, including growth in nearly all 20 brands, in 1Q. He added that the company’s raised guidance was still “conservative,” and that it could report at the high end of the current guidance, citing strong consumer demand, increased outdoor participation rates and higher demand for personal protection products.
Currently, the Street has a cautiously optimistic outlook on the stock with a Moderate Buy analyst consensus. The average price target of $20.25 implies upside potential of 38.4% to current levels. Shares declined about 5.6% since August 21, 2020 (post spin-off from Smith & Wesson Brands).