I always get excited about summer sports around the US Open PGA Tour which is played mid-June every year, and it got me thinking about small cap stocks you didn't know were public companies, but exist in the universe I cover. They sell a variety of products – from camping equipment to trampolines and pitch backs you see in the yard, and I’ve listed them below, with a quick thumbnail on what they do, their current value and what they have done so far this year.
Black Diamond, Inc. ($BDE) – Valuation: $300M; Stock Price: $9.30 – Black Diamond markets outdoor performance equipment and apparel for climbing, mountaineering, backpacking, skiing and cycling. The company provides climbing products, skiing products and an avalanche of safety devices. It also offers mountain line products and road cycling products. Black Diamond sells its products under the Black Diamond, POC, and PIEPS brands to mountain climbers, winter outdoor enthusiasts, backpackers, cyclists, ski racers, and outdoor-inspired consumers, and it’s headquartered in Salt Lake City, Utah.
YTD Recap: In March (post earnings), it rallied from $7 to $11 and settled back around $9.00 – let's wait until August earnings call to see how the summer is going. I will be listening to hear clues to yearend guidance to know if it will break out of the 7-10 range that it's in.
Escalade, Inc. ($ESCA) – Valuation: $270M; Stock Price: $19.16 – Escalade sells basketball hoops, archery, indoor and outdoor game recreation and fitness products. The company offers archery products under Bear Archery, Trophy Ridge, Whisker Biscuit, and Cajun Archery. They also sell STIGA Ping-Pong and Prince brands, and basketball hoops under Goalrilla, Goaliath, and Silverback brands; hockey and soccer game tables under Atomic, American Legend, and Redline brands; darting products under Unicorn, Accudart, Arachnid, Nodor, and Winmau brands; and outdoor games under Zume Games and Pickleball. Escalade was founded in 1922 and is headquartered in Evansville, Indiana.
YTD Recap: Shares are up 25% for the year and have been solid. They pay an impressive 11 cent dividend and they offer a wide variety of products and established brands. Escalade has been flying under the radar as a small cap for many years, though I bet you have some of their products in the basement or garage.
Sportsman Warehouse Holdings, Inc. ($SPWH) – Valuation: $480M; Stock Price: $11.43 – Sportsman Warehouse offers camping products and fishing products consisting of bait, electronics, fishing rods, flotation items, fly fishing, lines, lures, reels, tackle, and small boats. They also offer foot wear products that include hiking boots, socks, sport sandals, technical footwear, trail shoes, casual shoes, waders, and work boots. In addition, the company offers hunting and shooting products, including ammunition, archery items, ATV accessories, blinds and tree stands, decoys, firearms, reloading equipment, and shooting gear; and optics, electronics, and accessories comprising gift items, GPS devices, knives, lighting, optics, and two-way radios. Sportsman Warehouse has 57 stores in 18 states. They were founded in 1986 and they’re headquartered in Midvale, Utah.
YTD Recap: The stock has had a solid year, trading from $7 to $12 and eclipsing their 2014 high. This is all due to gun sales. This is clearly more than a summer sporting goods play – this is an ammunition and weapon play, so make sure you note that these stocks do well when markets go down and can be totally counter cyclical. Although a pullback is healthy, I see big ups for SPWH as a summer stock to watch. Gun and ammunition stocks often run counter to the market – if we have unrest and high crime or natural disasters in the news cycle, you will see portfolio managers buy undervalued gun and ammo names like SPWH.
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