Smith & Wesson shares slip about 3% premarket as Wedbush downgrades to neutral

Smith & Wesson Holding Corp. shares fell nearly 3% premarket Wednesday, after Wedbush downgraded the stock to neutral from outperform following a big move in its shares. Smith & Wesson rallied this week along with other gun stocks on expectations that new gun checks will prompt a surge in sales of guns and after the company raised its outlook for its January quarter. “While gun industry sales are clearly in ‘surge’ mode, it is difficult to discern just how much of these sales are in fact incremental to the industry versus pulled-forward demand, with plenty of historical examples of both,” analysts wrote in a note. Given a healthy valution and a stock that has climbed more than 150% in a year, “we are taking money off the table, and downgrading,” said the note.

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