POWWP - AMMO: Ammunition Sale Leaves Behind A Deteriorating GunBroker
2025-02-25 17:55:29 ET
Summary
- AMMO, Inc. sold its ammunition manufacturing assets for $75 million, leaving behind the GunBroker business.
- GunBroker's revenues have been on a decline. The company's strategy to increase the take rate has led to even more rapid GMV declines with competitors gaining market share.
- GunBroker still generates incredibly high margins, but financial uncertainty stands, especially as AMMO's financial reporting currently waits an ongoing accounting investigation.
- I believe that AMMO is still an unattractive investment as GunBroker's performance is deteriorating.
AMMO, Inc. ( POWW ) announced the company’s ammunition manufacturing asset sale on the 21 st of January to Olin Corporation ( OLN ), leaving the company with the GunBroker ecommerce platform for gun brokering. While the sale leaves AMMO with a high-margin business and $75 million in cash proceeds, the remaining GunBroker business has deteriorated in past years, leaving investors with an unattractive earnings performance. On top, AMMO’s accounting investigation still seems to be ongoing, and the company still hasn’t reported its financials from the July-September 2024 period....
AMMO: Ammunition Sale Leaves Behind A Deteriorating GunBroker