10 Best Gun Stocks to Buy in 2025

7. Smith & Wesson Brands, Inc. (NASDAQ:SWBI)

Number of Hedge Fund Holders: 15

Smith & Wesson Brands, Inc. (NASDAQ:SWBI) is a firearm manufacturing company headquartered in Maryville, Tennessee. It is one of the leading makers of long guns, handguns, rifles, and other shooting equipment. The company has been operating since 1852 and sells its products to various customers, including competitive shooters, firearm enthusiasts, security agencies, individuals desiring personal protection, sportsmen, and hunters.

On December 5, Smith & Wesson Brands, Inc. (NASDAQ:SWBI) declared financial results for the second quarter of fiscal 2025. It reported net sales of $129.7 million for the quarter, up 46.8% sequentially and 3.8% from last year, driven by the strength of the new Bodyguard 380 pistol and lever-action rifle. Gross margin stood at 26.6%, compared to 25.4% in the prior year’s quarter. GAAP net income for the quarter was $4.1 million, or $0.09 per diluted share, compared with $2.5 million, or $0.05 per diluted share, in Q2 2024.

However, the results came below Smith & Wesson Brands, Inc. (NASDAQ:SWBI)’s expectations as demand for firearms normalized late in the quarter. Due to inflation-driven pressures on demand, the company expects the top line to be between 10% and 15% lower year-over-year for the third fiscal quarter. SWBI’s share price is down 24% since the announcement of a grim forecast for Q3.

Despite a challenging environment, there are still enough reasons to remain bullish on the stock as it continues to outperform the market. Smith & Wesson Brands, Inc. (NASDAQ:SWBI) has been encouraged by the successful launch of new products, which represented 44% of the company’s sales in the recent quarter. Moreover, the firm authorized a new $50 million share repurchase program, reiterating its commitment to shareholder returns.

Wall Street analysts have a consensus Buy rating for SWBI and anticipate a 21% uptick, on average, in its share price. According to Insider Monkey’s database for Q3 2024, 15 hedge funds held a stake in the company, making it one of the best gun stocks to buy.