American Outdoor Brands Corp (Nasdaq: AOBC) posted better than expected fiscal third quarter earnings results, but its fourth quarter outlook was well below expectations and it slashed its full-year forecast as well.

Written by StockNews.com

The Springfield, MA-based gun maker, which recently changed its name from Smith & Wesson Corp, reported adjusted Q3 EPS of $0.66, which was $0.11 better than the Wall Street consensus estimate of $0.55.

Revenues rose 10.8% from last year to $233.5 million, edging out analysts’ $235.06 million view.

Looking ahead, AOBC forecast Q4 EPS of $0.32 to 0.42, well below the $0.57 that Wall Street is looking for. Its fourth quarter revenue estimate of $200 to 220 million would also badly miss analysts’ $243.91 million view.

As a result of its weak Q4 forecast, American Outlook lowered its full-year EPS outlook to a range of $2.33 to 2.43, down from a prior $2.42 to $2.47. Analysts are looking for $2.43 per share for the year. It also slashed its 2017 revenue forecast to $874 to $894 million, vs. a previous $920 to $930 million, and well below the Wall Street consensus of $919.46 million.

The company commented on its weakened guidance via press release:

“Toward the end of the quarter, consumer firearm purchasing began to cool — a trend that underscores the importance of remaining focused on our strategy to continue growing and balancing our business across the shooting, hunting, and rugged outdoor enthusiast markets.

…

During our third quarter, strong November results more than offset late-quarter declines in both NICS background checks and firearm product shipments. That late quarter shift in consumer demand patterns has since carried forward into our fiscal fourth quarter. Accordingly, we have updated our full year guidance.”

Investors didn’t react well to the company’s tepid outlook. American Outdoor Brands Corp shares fell $0.98 (-5.06%) in after-hours trading Thursday. Year-to-date, AOBC had declined -8.06% prior to today’s report, versus a +6.59% rise in the benchmark S&P 500 index during the same period.