(MENAFN- AFP) Smith & Wesson has shot its bolt for now.
Shares of the US gunmaker sank more than 10 percent Friday to $15.26 after the company projected an even steeper decline in sales and profits in fiscal 2015 than analysts expected. The weak outlook is due to a big drop in demand for semi-automatic sporting rifles.
Company executives, while remaining bullish on long-term demand for guns, said the near-term decline in hunting-rifle sales was expected after purchases surged following the December 2012 Sandy Hook shooting tragedy in Newtown, Connecticut, in which 20 young schoolchildren were killed.
Hunters went on a buying spree in subsequent months, fearing that semiautomatic rifles would be banned by a new crackdown led by President Barack Obama and gun control advocates in Congress.
However, new gun control legislation has stalled in Washington, and with it, so have sales of hunting rifles.
Smith & Wesson late Thursday posted a 4.6 percent decline year-over-year in sales in the fourth quarter ended April 30, to $170.4 million
Smith & Wesson forecast fiscal 2015 sales of $585-$600 million, down from last year's level of $626.6 million. Net income per diluted share is expected at $1.30-$1.40, down from $1.49 in 2014.
The 2014 results were the best in the 162-year-old firearms manufacturer's history, the company said.
Despite the weaker outlook, Smith & Wesson executives pointed to some bright spots. Demand for handguns remained brisk, with sales of these weapons rising 30 percent in the fourth quarter.
Officials also expressed confidence in the overall growth of the market, confirming on a conference call with analysts that the company still expects the gun market to expand between eight and 10 percent annually over the long term.
Shares of Smith & Wesson fell 10 percent to $15.30 in early-afternoon trade in New York.
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