Smith & Wesson Holding Corporation (SWHC): This Gun Maker Just Blew Away Earnings Estimates

Luckily, Smith & Wesson CEO James Debney provided some consolation on the company’s earnings conference call by stating that it’s not taking a haphazard approach to building out capacity. Instead, Debney says, the company will add it where it “believe[s] it is appropriate, and with a focus on balancing internal capacity expansion with the outsourcing of selected components.” This, in turn, provides the flexibility to enable growth while at the same time “providing a layer of insulation should the markets soften.”

Foolish takeaway

In the end, I’m encouraged not only by Smith & Wesson’s current results but also by the fact that it’s wisely managing the business for the long term with a shareholder-friendly attitude — and absent any delusions that the current boom will go on forever.

With shares currently trading at just 10 times last year’s earnings and 8.6 times next year’s estimates, then, I’m convinced Smith & Wesson stock represents a fantastic value at today’s levels.

The article This Gun Maker Just Blew Away Earnings Estimates originally appeared on Fool.com and is written by Steve Symington.

Fool contributor Steve Symington has no position in any stocks mentioned, and neither does The Motley Fool.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.