This book provides a highly accessible guide to the stock market, focusing on special situations that portfolio managers and investment experts often miss. It includes case studies, important background information, and tools for individual investors to exploit opportunities in areas like spin-offs, restructurings, merger securities, rights offerings, recapitalizations, bankruptcies, and risk arbitrage. Greenblatt, who has been beating the Dow with returns of 50 percent a year for over a decade, shares his expertise to help readers become successful stock market investors.
Shawn O’Malley and Daniel Mahnke break down Smith & Wesson (ticker: SWBI), an iconic firearms manufacturer with 170+ years of history. Smith & Wesson is no compounder, though. It’s an okay business, at best, but Shawn and Daniel want to determine whether this often-overlooked stock is cheaply priced.
In this episode, you’ll learn how Smith & Wesson has navigated the volatile sales cycle in firearms, what factors can drive the biggest swings in firearms sales, whether Smith & Wesson’s juicy dividend is sustainable, the biggest political and legal risks facing this company, what famous investor owns the stock, how Smith & Wesson shares can help an investor hedge societal disruptions, and whether Smith & Wesson is attractively valued on a normalized earnings basis plus so much more!
Prefer to watch? Click here to watch this episode on YouTube.
IN THIS EPISODE, YOU’LL LEARN
00:00 - Intro
02:47 - The historic origins behind this company that predates the Civil War.
06:12 - Why “Sin” stocks can offer attractive returns from discounted valuations.
10:54 - What drives Smith & Wesson’s business.
23:17 - How the company navigates a range of factors that can impact it, from regulation to litigation, that are largely beyond its control.
35:17 - How the company’s relocation of its headquarters has added to its financial stress.
46:11 - The biggest challenges of investing in a “mean reversion” bet like Smith & Wesson.
01:01:15 - Whether Shawn & Daniel add SWBI to The Intrinsic Value Portfolio.
01:05:38 - Why Smith & Wesson may be a hedge against societal disruptions.
And much, much more!
*Disclaimer: Slight timestamp discrepancies may occur due to podcast platform differences.
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