5 Biggest Gun Companies in the World

2. Sportsman’s Warehouse Holdings, Inc. (NASDAQ:SPWH)

2021 annual revenue: $1.5 billion

Founded in 1986, Sportsman’s Warehouse Holdings, Inc. is an outdoor sporting goods designer and seller. The company operates in 29 states in the United States, operating 122 stores in the country. The company produces high-quality hunting and shooting equipment, including firearms, reloading equipment, shooting gear, and archery items which accounted for 54.2% of the company’s 2021 sales.

Sportsman’s Warehouse Holdings, Inc. posted revenue of $1.5 billion in the fiscal year 2021, up 3.7% compared to $1.4 billion in the fiscal year 2020. The company’s strategic plan includes opening up 190-210 stores and achieving revenue in the range of $1.8 billion to $2 billion by the fiscal year 2025.

Here is what Merion Road Capital has to say about Sportsman’s Warehouse Holdings, Inc. (NASDAQ:SPWH) in its Q1 2022 investor letter:

During the quarter I added to Sportsman’s Warehouse (“SPWH”). SPWH is an outdoor sporting goods retailer with about half of their revenue coming from hunting & shooting products (guns, ammo). I initiated our position back in December following their failed merger with Great Outdoors on the grounds of anti‐trust concerns. It appeared that the stock was being sold off indiscriminately by merger arbitrageurs and valuation seemed attractive, particularly after adjusting for the receipt of a $55mm termination payment and unwind of excess inventory.

While the dust has largely settled from an investor base perspective, SPWH remains attractively priced with a few upcoming catalysts. Fundamentally the company is well positioned. Following the tragic Parkland school shooting two large competitors to SPWH, Dicks Sporting Goods and Walmart, made the decision to exit the category; their absence makes the competitive landscape for SPWH a lot more favorable than in prior years. Furthermore, it is no surprise that gun and ammo sales during covid experienced tremendous growth. Unlike prior cycles, however, this wave saw an increase in new gun buyers rather than purchases by existing owners. SPWH estimates that over the past 18 months the industry created 12mm new firearm owners; using a prior base of 100mm, this implies an increase to their addressable market of 12%. The company is executing on many other internal initiatives including store expansion, omni‐channel growth (e‐comm up to 15% of revenues), loyalty programs (at 3mm members) and new co‐branded credit cards… (Click here to see the full text)