That price seems high without the original grips... but at the same time, the 16-4 production was discontinued 28 years ago in 1993, with total production across the 3 barrel lengths being approximately 8800, that makes their numbers relatively low.
They haven't gone out of demand, in fact it's been the opposite due to the popularity and ease of converting them to .327 Fed Mag.
How many times have you seen a 16-4 come up for sale?
After I bought mine new in 1993 for $430, it was 7 years before I saw a 16-4 for sale locally, and I paid $950 for it in 2010.. albeit California pricing, which is higher than the rest of free world.
I've mentioned this before, but if you're an ongoing repeat buyer of S&W's (like me), the principle of dollar cost averaging comes into play, like buying stocks.
Across purchases, you've bought lower, and also bought slightly higher.
Divide the total amount paid for all of your guns by the number you have and you get the dollar cost average price of each one, which is usually lower than the highest actual price paid for any one gun.
When the 16-4 came up for sale in 2010 at 950, I balked at first at the price.
But when I thought about it in terms of dollar cost averaging... the first 16-4 cost me $430, if I were to buy the second one at $950, it would make a total of $1380 paid for two 16-4's.
Dividing that by 2 and the average cost for each of the two 16-4's becomes $690 each. I decided that I could live with that and made the purchase.
I've since had that 2nd 16-4 converted to .327 Fed Mag, and couldn't be more happy with it.
Just some food for thought for looking at the financials a different way.