Smith & Wesson Down; Kroger Sales Beat; GMS Jumps

On this episode of Stock Movers:
- Smith & Wesson Brands (SWBI) sinkafter the firearm company reported adjusted earnings per share for the fourth quarter that missed the average analyst estimate.
- Kroger’s (KR) sales surpassed expectations during the latest quarter, a sign that consumers are still spending on groceries and other essentials even amid economic turbulence. The nation’s largest supermarket operator said its comparable sales, excluding fuel, rose 3.2% — better than what Wall Street analysts were expecting. The company also raised its full-year sales guidance to a range of 2.25% to 3.25%, but reaffirmed the rest of its outlook.
- GMS (GMS) shares rise after the Wall Street Journal reported that Home Depot has made an offer for the building materials firm, potentially setting off a bidding war with QXO which made a $5 billion offer earlier in the week

See omnystudio.com/listener for privacy information.

Episode Transcript

Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio news, The Stock Movers podcast,
your roundup of companies making moves in the stock market,
harnessing the power of Bloomberg data. Let's take a look
at some of the stocks on the move today.

Speaker 2 (00:19):
I'm Paul Studios, Michael Reagan, and we're joined by bloomberg'st
Least my tay it all right, So I want to
start with shares of gunmaker Smith and Wesson. That's ticker SWBI.
Their shares have been down as much as nineteen percent.
It's saying thirteen percent after the close yesterday. It's really
looking at another challenging year. Right, Customers have been cutting
back there spending on firearms. It posted lower quarterly profit

(00:41):
in sales some of the specifics. So it posted profit
of eight point six million compared with twenty seven point
three million a year earlier. So that's a big difference.
And it also pointed in factors like inflation, interest rates.
It said tariffs on steel could drive up their costs.
And it's CFO really put into perspectives that the company
expects demand for firearms and fiscal twenty twenty six to

(01:02):
be similar to what they saw in fiscal twenty twenty five.
Management didn't provide any guidance because of uncertainty with tariffs.
But what it's doing differently to deal with the slower demand,
and that is it's limiting its inventory. So its CEO said,
several market smaller on firearm manufacturers, they're also struggling to
stay afloat because of the slowing demand, and they're also

(01:23):
starting to exit the market too.

Speaker 1 (01:25):
I thought this was a bigger company market cap of
only three hundred and eighty seven million dollars.

Speaker 2 (01:29):
Okay, I got it. Maryville, Tennessee is where they're based,
fifteen hundred employees.

Speaker 1 (01:33):
What else you got?

Speaker 2 (01:34):
All right, so we got Kroger that's the nation's largest
supermarket operator. Yes, ticker k r IT shares rose more
than eight percent. That's actually the highest intra day since
March of twenty twenty four. Reported a beat on sales,
steady grocery spending, comparable sales when you take fuel kind
of out of the picture. It rose three point two percent.
That was better than what Wall Street expected. They also

(01:55):
raised full of your sales guidance. They said it saw
one hundred million dollar impairment charge that was due to
its plans to close about sixty stores over the next
eighteen months, so they do plan to close some stores
when it comes to tariffs. They said, you know what,
it's not going to bother us too much because a
big part of our products are sourced domestically. But it
still faces a few challenges, Paul, I know, this is
one that you've talked about. Shoppers kind of buying the

(02:17):
cheaper products, you know, like going in the stars.

Speaker 1 (02:19):
Yeah, going to.

Speaker 2 (02:20):
The cheaper products, or they're getting more items on sale too,
and it really needs to spark growth because it had
that failed deal with Albertson, so that it's also dealing
with that too on top of it.

Speaker 1 (02:31):
But they're not They're not around here, are they. They're
not in the Jersey area, Rover, We're not too much.

Speaker 2 (02:36):
But if you look at shares, like for other ones
that are in the area, like a Walmart and a Costco,
their shares are higher too because of this news.

Speaker 1 (02:42):
Interesting all right.

Speaker 2 (02:43):
And then finally is Building Products Distributor GMS. It's ticker, Yes, GMS.
It's shares are up as much as twenty five cents,
so really sparking the reason why it's this Wall Street
Journal report that Home Depot made an offer for the company,
no word on the price, and that would possibly set
off this bidding war with QXO because they offered to
buy a GMS for about five billion dollars earlier this week,

(03:06):
and GMS said its board is reviewing that offer from QXO.
But the big appeal with GMS, like what's so appealing
about it is that home Depot in QXO, they're they're
looking to expand right their share for market construction supplies
and tools, and they're hoping that that bigger entity like
GMS is going to help pull in business for more
contractors and that's what they're needing. So QXO they're up

(03:26):
about five percent. Home Depot has been up as much
as half a percent.

Speaker 1 (03:30):
The Stock Movers podcast from Bloomberg Radio. Check back with
us throughout the day for the latest roundup of companies
making news on Wall Street and for the latest market
moving headlines. Listen to Bloomberg Radio Live, catch us on YouTube,
Bloomberg dot com, and on Applecarplay and Android Auto with
the Bloomberg Business app.