Gun Demand Slows in U.S.

by Christopher Freeburn | December 11, 2013 10:48 am

Americans appear to be buying fewer guns in recent months[1], compared to earlier this year when firearm sales seemed to be exploding.

Guns630 300x199 Gun Demand Slows in U.S.[2]
Source: Flickr[3]

This week, two gun manufacturers have posted data showing that sales are slowing. Remington Outdoor says 2013 sales will grow between 34% and 37% year-over-year (down from 51% from 2013′s first nine months), while Smith & Wesson (SWHC[4]) announced a 2% YOY sales improvement and a 20% drop in earnings during its most recent quarter.

In November, federal gun sale background checks slipped 10% compared to 2012, the Wall Street Journal notes.

On the flip side, not all gun-related stocks are seeing a downturn. Last month, Sturm, Ruger & Co. (RGR[5]) announced third-quarter earnings up 64% over the previous year[6] as sales surged 45%. Meanwhile, outdoor retailers Cabela’s (CAB[7]) and Gander Mountain have big expectations on the expansion front.

Gun sales surged during the first half of the year as gun owners scrambled to purchase firearms in anticipation of potential new gun control measures[8] in the wake of the December 2012 massacre at Connecticut’s Sandy Hook Elementary School, in which 20 children and six adults were killed by a lone shooter.

However, despite the death toll and resulting public outrage, new regulations failed to gain traction in Congress. In April, even a measure designed to tighten gun sales background checks — generally considered the most moderate gun control proposal — could not attract enough votes to clear the U.S. Senate[9]. Gun control legislation has scored only limited victories in a small number of states.

Endnotes:
  1. buying fewer guns in recent months: http://online.wsj.com/news/articles/SB10001424052702303330204579250631438641924
  2. [Image]: http://investorplace.com/wp-content/uploads/2012/12/Guns630.jpg
  3. Flickr: http://www.flickr.com/photos/22280677@N07/2742407693/sizes/m/in/photostream/
  4. SWHC: http://studio-5.financialcontent.com/investplace/quote?Symbol=SWHC
  5. RGR: http://studio-5.financialcontent.com/investplace/quote?Symbol=RGR
  6. third-quarter earnings up 64% over the previous year: http://investorplace.com/2013/11/gun-stocks-start-earnings-bang/#.UqiEzZG1Kf0
  7. CAB: http://studio-5.financialcontent.com/investplace/quote?Symbol=CAB
  8. anticipation of potential new gun control measures: http://investorplace.com/investorpolitics/obama-backs-new-gun-laws/#.UqiF_JG1Kf0
  9. could not attract enough votes to clear the U.S. Senate: http://investorplace.com/investorpolitics/senate-blocks-gun-control-bill/#.UqiFTZG1Kf0

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