SPWH SPORTSMAN’S WAREHOUSE HOLDINGS
Sector financial performance:
This company, which is primarily a retailer of equipment for hunting& shooting and others including fishing and camping, has been grouped into outdoor sporting goods retailer sector in sport goods industry.
It seems that the decline in demand for sports firearm and ammunition may have been slowing down in the past year after the significant shrink in 2017 and 2016 as indicated by the same store revenue of those products in the typical retailers during the same period of time. The same store revenue for sportswear and footwear seems to continuingly go downs.
The typical gross margin for retailers in this sector is about 34% in 2018, the SG&A as percentage of sales is 28%, and the operating margin was down to about 6% in 2018. And the EBI/sales ratio was about 4% in 2018.
The typical enterprise price/EBI ratio is 12.
It seems that the demand for firearm and ammunition of this company has significantly declined in 2017 and 2016 as indicated by the declined same store revenue of those products. However, the demand seems to be rebounding after entering 2018. Other outdoor sporting goods such as camping, clothing, and footwear have also experienced decrease during the same period of time.
The first three months of fiscal 2018 compared with the same period of the 2017 (ended mar 31 2018)
Net revenue increased about 15%.
Same store sales increased 3.4% due to the increase of 9% in ammunition and increase of 17% in firearm revenue offset by decrease of 5.3% in camping and decrease of 5.2% in footwear.
Fiscal 2017 compared with fiscal 2016
Net revenue increased about 3%.
Same store sales decreased 7% due to the decrease of 16% in ammunition and decrease of 9% in firearm revenue and decrease of 2.5% in camping.
Fiscal 2016 compared with fiscal 2015
Net revenue increased about 10%.
Same store sales decreased about 1% due to the decrease of 5% in shooting and decrease of 2% in clothing.
Its gross margin (excluding depreciation, rent, and store operation) was flat at around 34%. With the increased SG&A as percentage of sales (up to about 28% in 2018), its operating margin went down to about 6% currently.
This company is having an enterprise price/EBI ratio of 12. We think that its stock was relatively overvalued COMPARED similar sport good retailer.
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