Soaring Gun Demand Boosts Firearm Maker Stocks

Soaring Gun Demand Boosts Firearm Maker Stocks

Smith & Wesson pistols sit on display at the company’s booth during the National Rifle Association (NRA) annual meeting of members. Firearm and ammunition stocks have had a great run in 2020 , and the latest sales data shows no sign of slowing demand, Keybanc Capital Markets noted. Analyst Brett Andress looked at the latest adjusted September data for the National Instant Criminal Background Check System (NICS), a proxy for gun demand, which climbed 61.4% year over year. For the third quarter as a whole, background checks were 74.8% higher, compared to the same quarter last year. He noted that September was the sixth straight month of more than 50% year-over-year growth, a number that’s “unprecedented within this dataset,” and which he believed reflects the “recent sustainability of consumer firearm demand.” The checks data show an 81% increase in demand for handguns, and 50.6% increase for long guns, with more than 30 states showing increases of more than 50%. States with the biggest jump in background checks last month were Michigan, New Jersey, Rhode Island, and Maryland, all of which saw more than a 100% rise. Andress wrote that some may have been expecting somewhat of a drop in demand after August’s robust numbers, but that hasn’t happened. He expects October will “remain solidly positive” as well, given ongoing social unrest and uncertainty surrounding the pandemic. That said, the outcome of the election will likely determine how strong demand remains in November and beyond. Strum Ruger & Co. (ticker: […]

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