Sportsman's Warehouse Is Not Improving And Is Leveraging More - Not An Opportunity

Summary

• Sportsman's Warehouse faces significant challenges with sales down 10% and increasing debt, despite strong cost control and SG&A management.
• Inventory issues and low stocks are impacting sales, especially ahead of the crucial Q3 hunting season, with management warning of a tough quarter.
• The company is heavily leveraged, with growing debts and operational losses, raising concerns about its ability to survive a prolonged recession.
• Given the lack of signs of improvement and high capital loss risk, I maintain a Hold rating on SPWH stock.