American Outdoor Brands (AOUT) Company Overview & Stock Price Forecast
This article provides a brief analysis and stock rating for American Outdoor Brands (AOUT) including an updated stock price target. Additional data on the company’s earnings yield, price/earnings ratio, return on invested capital and YTD performance are discussed as well.
American Outdoor Brands Fundamentals
Stock Price Target: $32.91
In the section below, we discuss the earnings yield, P/E, return on invested capital and YTD performance for American Outdoor Brands in comparison to the Recreation industry and the S&P 500.
American Outdoor Brands is a Small Cap company with a Market Cap of $233M.
How are investors using American Outdoor Brands earnings yield to assess the company?
The earnings yield is used to show the percentage of a company’s earnings per share. Investors typically use earnings yield to determine which assets are underpriced or overpriced relative to other variables, like sector, industry or bond yields. Simply put, the earnings yield of a company can be used to assess how expensive a company is in relation to the earnings that are generated. When valuing companies, the SIS Research Group does not utilize the inverse P/E ratio to calculate the earnings yield. Instead, we use an adjusted earning yield calculation to capture variation amongst companies (i.e. debt and tax rates).
The current earnings yield for American Outdoor is 14.29%, in comparison to 3.76% for the S&P 500 and 1.78% for the 10-year treasury bond. The median earnings yield for the Recreation industry is 7.51%.
What does American Outdoor Brands Price-to-Earnings Ratio (P/E) tell investors about the company?
The price-to-earnings ratio (P/E) is a relatively popular metric used by investors and analysts for valuing a company’s stock. The P/E ratio can be used to show how a stock’s valuation compares to other companies and the total market. Investors use the P/E ratio to determine what the market is willing to pay today based on a company’s past or future earnings. A high P/E ratio could mean that a stock’s price is too high relative to earnings, which could be a signal that a stock is currently overvalued. In turn, a low P/E ratio could indicate that a company’s current stock price is low relative to earnings.
American Outdoor is currently trading at a P/E of 13.69. The P/E for the Recreation industry is 46.62 and the P/E for the S&P 500 is 26.59.
What is the current Price-to-Sales Ratio (P/S) for American Outdoor Brands?
The Price-to-Sales Ratio (P/S) looks at a company’s market cap and revenue to determine valuation. The P/S ratio is calculated by taking a company’s market cap and dividing by the total sales or revenue. The P/S ratio gives an idea of how much the market values every dollar of a company’s sales and can be effective in valuing unprofitable growth stocks or companies that are currently undergoing special situations or challenges. A lower the P/S ratio can be an indicator of good value.
American Outdoor is currently trading at a P/S of 0.85. The P/S for the Recreation industry is 2.24 and the P/S for the S&P 500 is 3.19.
How does American Outdoor Brands Price-to-BookRatio (P/B) compare to the Recreation industry?
Price-to-book value (P/B) is the ratio of the market value of a company’s shares divided by its book value of equity (the value of it’s assets on the books). The book value is the difference between the book value of assets and liabilities. Typically, investors use the P/B ratio to assess if a stock is valued properly (a value of one means that the stock price is trading in line with the book value of the company). A company with a high P/B ratio could mean the stock price is overvalued as well as the converse.
American Outdoor P/B ratio is 0.83. The P/B for the Recreation industry is 5.35 and the P/B for the S&P 500 is 4.81.
How attractive is American Outdoor Brands Return on Invested Capital (ROIC) to investors?
Investors use the return on invested capital (ROIC) to assess how efficient a company is at turning capital into profits. The ROIC is the amount of money a company makes on it’s investments that is above the average cost of debt and equity.
Investors can use the ROIC to provide context for metrics like the (P/E) ratio. For instance, when used in isolation a low P/E ratio could suggest a company is oversold but the decline could be because a company is no longer generating value for shareholders. Conversely, companies that consistently generate high rates of ROIC can plausibly trade at a premium compared to other stocks, even if their P/E ratios are high.
American Outdoor ROIC is currently 5.70% in comparison to 18.44% for the Recreation industry and 9.10% for the S&P 500.
How has AOUT stock performed over the past year? What is the current analyst price target?
Over the past 52 weeks, American Outdoor has traded between the range of $16.17 and $36.62.
The current Analyst Price Target for American Outdoor is $32.91.
What is American Outdoor Brands YOY Performance in comparison to its industry and the total market?
The YOY performance for American Outdoor is -13.59%. The Recreation industry has a YOY performance of 0.97% in comparison to the YOY S&P 500 performance of 18.96%.
Recent Financial Results
- Net sales of $70.8M for the second quarter of fiscal 2022, compared with net sales of $79.1M for the second quarter of fiscal 2021
- Gross margin of 46.7% was a decrease of 20 basis points from the comparable quarter last year
- Net income of $4.6M, compared to net income of $7.3M for the comparable quarter last year
- Non-GAAP net income of $8.3M, compared with non-GAAP net income of $11M
- Adjusted EBITDA of $11.7M, or 16.5% of net sales, compared with $15.8M, or 19.9% of net sales, for the comparable quarter last year
Stock Price Target: $32.91
American Outdoor Brands, Inc. provides outdoor products and accessories for rugged outdoor enthusiasts in the United States and internationally. The company offers hunting, fishing, camping, shooting, and personal security and defense products.
The company sells its products through e-commerce and traditional distribution channels under the Marksman, Defender, Harvester, and Adventure brand lanes. American Outdoor Brands, Inc. was incorporated in 2020 and is headquartered in Columbia, Missouri. The current CEO is Brian D. Murphy.
Be sure to add American Outdoor Brands (AOUT) to your Watch List and if you haven’t done so already, check in on the performance of our Current Portfolio. Keep it simple and always do your due diligence.
This material is provided for informational purposes only and is not financial advice. The information contained herein should not solely be used for the formation of an investment decision, whether you are a long term or short term investor.