Sturm, Ruger & Co (RGR) Misses Earnings, Revenues Fall 21%

Sturm, Ruger & Co (NYSE:RGR) just released its fourth quarter fiscal 2017 financial results, posting earnings 59 cents per share and revenues of $118.2 million. The stock is down 4.86% to $45 per share shortly after the report was released.

Currently, RGR is a #3 (Hold) on the Zacks Rank, and while our consensus estimate trend has remained stable for the next few periods, Ruger’s year-over-year earnings growth is estimated to decline.

Ruger:

Missed earnings estimates. The firearm maker reported earnings of 59 cents per share, falling short of the Zacks Consensus Estimate of 62 cents per share. However, the new tax reform bill positively impacted earnings by $0.03 per share.

Beat revenue estimates. The company saw revenues of $118.2 million, surpassing our consensus estimate of $113.5 million but declining 21% year-over-year.

Ruger noted that new products represented 27% of firearm sales in 2017.

The company also said that overall decline was due to decreased consumer demand last year, mostly thanks to higher-than-normal demand during most of 2016 (which was likely bolstered by the intense political climate and campaigns). Aggressive price discounting and lucrative consumer rebates offered by its competitors hurt Ruger as well.

Cash generated from operations during 2017 was $101 million, while Ruger is currently debt-free.

Here’s a graph that looks at Ruger’s price, consensus, and EPS surprise:

Sturm, Ruger & Company, Inc. Price, Consensus and EPS Surprise

Sturm, Ruger & Company, Inc. Price, Consensus and EPS Surprise | Sturm, Ruger & Company, Inc. Quote

Sturm, Ruger & Co. is one of the nation's leading manufacturers of rugged, reliable firearms for the commercial sporting market. As a full-line manufacturer of American-made firearms, Ruger offers consumers variations of the product lines, from the ubiquitous 10/22® and Mini-14®, to the new and exciting LCP® II, Mark IV, Ruger American Pistol®, Ruger Precision Rifle®, SR-556 Takedown®, AR-556® and Ruger American Rifle®. Their awarding-winning products all prove that Ruger has a rugged, reliable firearm to meet every shooter's needs. Ruger has been a model of corporate and community responsibility.

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