Market News

AMMO Shares Rally 9.2% as Q4 Earnings Beat Expectations

Shares of ammunition products manufacturer AMMO Inc. (POWW) rallied 9.2% in the extended trading session on Tuesday after the company reported better-than-expected results for its fiscal fourth quarter and full-year ending March 31, 2021.

The company reported adjusted earnings of $0.04 per share for the quarter versus consensus estimates of a loss of $0.01 per share. The bottom line also compared favorably to a loss of $0.06 per share in last year’s quarter.

The company reported revenues of $24.2 million and surpassed the Street’s expectations of $24 million.

Notably, adjusted EBITDA increased considerably to $4.8 million during the quarter on account of AMMO’s efforts to scale operational costs. The company expects EBITDA in the first half of fiscal 2022 to be better than the second half of fiscal 2021. (See AMMO stock chart on TipRanks)

The company guided that first-quarter revenues are expected to be $41 million, including two months of operations from newly acquired Gunbroker.com. The company expects to achieve profitability in this quarter.

Last month, Roth Capital analyst Matt Koranda reiterated a Buy rating on the stock with a price target of $9 (2.4% upside potential) after the company updated its guidance to $41M.

“Management emphasized 1FQ as the first profitable quarter in company history, which is in line with our prior expectations largely due to the addition of the highly-profitable Gunbroker.com business,” Koranda said.

The rest of the Street is cautiously optimistic about the stock with a Moderate Buy consensus rating based on 2 Buys. The average AMMO price target stands at $9 per share.

TipRanks data shows that financial blogger opinions are 100% Bullish on POWW compared to the sector average of 69%.

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