Pre-Q4 Earnings: Should Byrna Stock be in Your Portfolio?

Byrna Technologies Inc. BYRN is set to report its fourth-quarter fiscal 2024 results on Feb. 7, before the bell.

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The Zacks Consensus Estimate for earnings in the to-be-reported quarter stands at 5 cents per share against a loss of 2 cents in the year-ago quarter. The consensus mark for revenues is pegged at $28 million, indicating year-over-year growth of 79%.

One estimate for the to-be-reported quarter moved up over the past 60 days versus no downward revision. Over the same period, the Zacks Consensus Estimate for the fourth-quarter fiscal 2024 earnings has increased by 11.8%.

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BYRN has had an impressive earnings surprise history. Earnings surpassed the Zacks Consensus Estimate in all the four trailing quarters, the average surprise being 532.5%.

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Lesser Chance of a Beat for BYRN This Time

Our proven model doesn’t conclusively predict an earnings beat for BYRN this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

BYRN has an Earnings ESP of 0.00% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Media Exposure Should Boost BYRN’s Results

Byrna has achieved high brand visibility through a successful celebrity endorsement program and extensive media coverage. We believe increased media exposure continued to help normalize less-lethal solutions in the fiscal fourth quarter, significantly boosting consumer and law enforcement demand.

BYRN’s Price Dynamics

BYRN has seen a remarkable rise in its stock price, soaring 235% over the past year compared to the broader industry’s 72% growth. This contrasts sharply with the performance of other small-cap service providers like FuelCell Energy FCEL, down 79%, and Ballard Power Systems BLDP, which saw a 57% decline during the same period.

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Investment Considerations

Byrna is prioritizing growth investments, remaining debt-free and highly profitable, and continues to demonstrate strong revenue growth and promising market potential. The company delivered notable 194% year-over-year sales growth for the last reported quarter, while net income improved from a loss of $4.1 million in the previous year to a profit of $1.0 million, an impressive $5.1 million increase.

Byrna’s return on equity (ROE) of 10.4% at the end of the third quarter of fiscal 2024, outperforming the industry average of 9.1%, signals stronger profitability and efficient use of shareholders' equity. The company’s liquidity position is also strong, with a current ratio of 3.51 at the end of the third quarter of fiscal 2024 compared to the industry’s 0.92. Such a robust liquidity position offers financial flexibility, allowing it to invest in growth opportunities or manage unforeseen expenses without the immediate need for additional financing.

BYRN recently extended its reach into Mexico by collaborating with Mexico’s Secretaría de Trabajo y Previsión Social to establish a federally certified training program allowing civilians to legally carry Byrna devices. Furthermore, the company is enhancing its supply chain by shifting ammunition production domestically, which is expected to improve product margins. These initiatives, alongside continued marketing investment, are anticipated to drive growth through 2025 and beyond, positioning Byrna for sustained success.

BYRN is a Buy

BYRN represents a compelling growth investment with its strong brand momentum and expanding market presence. The company’s strategic use of celebrity endorsements and extensive media coverage has bolstered its visibility, leading to heightened demand for its innovative, less-lethal solutions. Byrna’s focus on expanding its product lineup and strengthening partnerships both domestically and internationally showcases a forward-looking approach that aligns with market trends, positioning it well for sustained growth.

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