Shooting Popularity Means Vista Outdoor Can Pass On Higher Costs

(Bloomberg) -- Americans’ enthusiasm for outdoor sports, particularly shooting sports, is so strong that Vista Outdoor Inc. Chief Executive Officer Chris Metz says he can pass on his company’s inflationary costs from raw material shortages and supply chain constraints to consumers.

“Everything you’re reading in the headline news with raw material shortages, be it copper, or steel, or resin, or cardboard, chips, it’s all true,” Metz said in an interview.

Vista is battling with tight logistics too. Transportation logjams and constraints are making it difficult for goods to be loaded onto trains or trucks, Metz said.

But the persistent demand for gun accessories and outdoor products is helping the company pass on the costs to consumers, he said. Vista posted quarterly earnings on Thursday that blew past analysts’ estimates, with “shooting sports,” a category that accounted for about two-thirds of revenue, seeing a 37% spike in sales.

Though Vista more than tripled its share price last year, the stock slipped as much as 9.3% intraday Thursday as investors assessed the company’s announcement that it would increase research and development spending next fiscal year by 25%.

While expensive, that could allow the company to build new products with higher margins, Metz said, adding that he has to “tell the team not to look at” the stock performance.

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