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The Gun Safe

Gun Stocks: Is Now the Time to Pull the Trigger?

Gun Stocks
Image: Creative Commons.

Collectible firearms have continued to bring in record prices at auctions, and earlier this year Milestone Auctions of Willoughy, Ohio announced it broke past records after selling an 1859 Berdan Sharps rifle, Sammy Davis Jr.’s .357 Magnum and even a Walther pistol that was captured at the end of the war at Hitler’s mountaintop retreat. With more than $1.5 million in sales, it was the highest-grossing auction for the company to date, and many of the firearms had come from the collection of the late Gary Thomas, a noted weapons enthusiast.

Even a basic AR-15 and Glock pistol are fetching higher prices, which is great news if you’re selling but not so good if you’re a buyer. As 2020 saw record sales, with more than 23 million firearms sold, and sales remaining strong in the first months of 2021, prices were bound to go up with sales.

This year has seen a forty-one percent year-over-year increase in FBI’s National Instant Criminal Background Check System (NICS), which serves as an indicator that firearm sales remain strong and show little sign of slowing down anytime soon.

Now could be the time to get in on the action. Not by selling guns, but rather by buying stock in the manufacturers.

Time to Buy Gun Stocks?

InvestorPlace recently recommended seven gun stocks to buy amid surging firearms sales. The investment website noted that those companies include Smith & Wesson Brands (NASDAQ:SWBI), Sturm Ruger (NYSE:RGR), Big 5 Sporting Goods (NASDAQ:BGFV), Vista Outdoor (NYSE:VSTO), Olin Corporation (NYSE:OLN), Ammo (NASDAQ:POWW), and American Outdoor Brands (NASDAQ:AOUT).

“Stock prices for U.S. firearm manufacturers appear to fluctuate based on two factors — an increase in the probability of firearm regulation and the short-term perception of danger to life and property,” Anand Gopal, professor of information systems at the University of Maryland’s Robert H. Smith School of Business, told Investor Place.

Just last month, Springfield, Mass.-based Smith & Wesson reported record sales for the first quarter of 2021, selling more than 600,000 firearms and accessories – which was more than a quarter of a billion dollars worth of products. That actually represented a doubling of sales from a year ago, and it was Smith & Wesson’s third consecutive record-breaking quarter.

Some of the other companies recommended by Investor Place also have reported strong sales, and stock prices have been on the rise. Sturm Ruger (RGR) has seen sales increase in the last few years, while the company announced a dividend of 71 cents per share.

American Outdoor Brands (AOUT) was also highlighted as a potential good pick, as the company had a banner year since it was spun off from Smith & Wesson Brands less than a year ago. In its first two fiscal quarters sales for the new firm have increased by sixty percent.

For those who are looking to cash in on strong gun sales, now could be the time to pull the trigger.

Peter Suciu is a Michigan-based writer who has contributed to more than four dozen magazines, newspapers and websites. He regularly writes about military small arms, and is the author of several books on military headgear including A Gallery of Military Headdress, which is available on Amazon.com.

Written By

Peter Suciu is a Michigan-based writer who has contributed to more than four dozen magazines, newspapers and websites. He is the author of several books on military headgear including A Gallery of Military Headdress, which is available on Amazon.com.

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