3 Gun Stocks That Will BOOM on the Concealed Carry Act

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gun stocks - 3 Gun Stocks That Will BOOM on the Concealed Carry Act

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With the Republicans scoring an unprecedented general election victory, it was only a matter of time before they started to test the waters. However, Senator John Cornyn of Texas is going for the jugular with the Constitutional Concealed Carry Reciprocity Act. The measure, which proposes the loosening of concealed carry laws, won’t be popular with Democrats. Even some Republicans might be hesitant with the scope of the Concealed Carry Act.

3 Gun Stocks That Will BOOM on the Concealed Carry Act
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On the surface, the proposal is at least politically palatable. According to Senator Cornyn, the Concealed Carry Act “strengthens both the constitutional right of law-abiding citizens to protect themselves and the power of states to implement laws best-suited for the folks who live there.”

However, Bloomberg argues that the “bill would adopt as a national standard the lowest common denominator of state regulations.” Such drastic measures would likely only find universal support from investors of gun stocks.

What the Constitutional Concealed Carry Reciprocity Act implies is that notoriously anti-gun states will be forced to loosen up. That would be a paradigm shift in states like California, where the right to open carry was taken away. Should the Concealed Carry Act become the law of the land, gun stocks are sure to reap the benefits.

Unlike other firearm platforms, concealed carry means only one thing — the smaller, the better. That’s a complete 360 from the mentality of many gun range dwellers, who are loud and proud. Because of this dynamic, these folks likely need to buy a firearm that would meet the requirements for concealed carry. After all, a fully kitted AR-15 isn’t exactly inconspicuous.

CNBC counters that demand for firearms, and by extension gun stocks, would fall under the Constitutional Concealed Carry Reciprocity Act. Without the fear of losing gun rights thanks to the Republican government, the incentive to buy is non-existent. I counter their counterargument with a simple fact — gun stocks and firearm sales aren’t always driven by fear.

Look at the year 2004. That was when President George W. Bush let a federal assault weapons ban expire. Boom! It was the opening of a new market — and not a mass shooting — that skyrocketed firearm sales. Indeed, the AR-15 craze that the mainstream media hyperventilates about was Republican-driven, not the other way around.

The Concealed Carry Act, should it pass, will do the same thing — open a new market. This time, it won’t be scary, evil rifles, but concealable, self-defense handguns. Of course, this will open up its own set of political criticisms. Nevertheless, I’m confident that firearms and ammunition manufacturers will benefit handsomely.

Here are three gun stocks that you need to reload right now!

Gun Stocks to Buy: Sturm Ruger & Company Inc (RGR)

Gun Stocks to Buy: Sturm Ruger & Company Inc (RGR)
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Source: Source: JYE Financial, unless otherwise indicated

It’s not even fair, when you really think about it. Among both domestic and international gun stocks, RGR just stands out when it comes to concealed carry. They’ve been in the business for a long time, and they know just what their customers wants and needs.

For starters, RGR currently sells six different autoloader pistols that are compatible with the spirit of the Concealed Carry Act. These pistols feature enhanced ergonomics and engineering to help mitigate the sharper recoil inherent in a smaller platform.

In addition, RGR offers their concealed carry weapons in multiple calibers, which helps in recoil management. They also sell a pink handgun chambered in the lesser-punishing 380 Auto caliber. The takeaway here is that RGR has a self-defense solution for everyone.

On the market front, Ruger stock has certainly seen better days. Year-to-date, RGR is down more than 7%, which contrasts sharply with its earlier success. However, the good news is that a Republican presidency doesn’t spell doom. And if the Concealed Carry Act pushes through, RGR is in prime position to advantage a new market.

Gun stocks have recently fallen out of favor, but new proposals should reinvigorate RGR.

Gun Stocks to Buy: American Outdoor Brands Corp (AOBC)

Gun Stocks to Buy: American Outdoor Brands Corp (AOBC)
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Source: Source: JYE Financial, unless otherwise indicated

At first, the shift is difficult to get used to, and it is perhaps a little confusing. Smith & Wesson conjures up images of “Dirty Harry” blowing away baddies. American Outdoor Brands sounds like a camping trip in which you’d rather not be involved.

But don’t let the name fool you — AOBC is still very much Smith & Wesson. It was more of a business-centric decision. American Outdoor doesn’t want to be levered too much in any one particular sector. For a while, gun sales were sporadic. The combination of a liberal President and random, tragic events created huge spikes in AOBC, followed by staggering lulls. Its disappointing earnings results affirm that they probably made the right decision.

A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare. Tweet him at @EnomotoMedia.

That’s why of all the pure gun stocks, AOBC stands to benefit the most. Yes, they’re branching out to other sectors, but they’re not fooling anyone. American Outdoor will always be a gun manufacturer first so long as it keeps its Smith & Wesson division. As should be pretty obvious to most folks, AOBC knows quite a few things about handguns. Therefore, the Concealed Carry Act is being proposed not a moment too soon.

Gun Stocks to Buy: Vista Outdoor Inc (VSTO)

Gun Stocks to Buy: Vista Outdoor Inc (VSTO)
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Source: Source: JYE Financial, unless otherwise indicated

On a year-to-date basis, VSTO stock is down an alarming 44%. Sadly, we haven’t even reached the end of the first quarter. In addition, VSTO doesn’t specialize in handguns, but rather, hunting rifles and shotguns. So why pick VSTO? Because they have an abundance of ammo!

The other implied component of the Concealed Carry Act is increased sales of ammo. Unlike normal-sized guns, concealed carry weapons are difficult to master. The lessened weight and the reduced barrel length means that recoil is very snappy. Flinching from the recoil leads to reduced accuracy, which is a big problem if your life is on the line. The only way to manage this situation is practice, practice, practice and VSTO makes this cheap.

Through their Blazer aluminum-cased ammo, shooters can learn the unique dynamics of a compact handgun at a lower cost than firing brass cartridges. But when it comes down to the real thing, shooters require three attributes. They are reliability, lethality and optimal penetration. In other words, the ammo has to fire when called upon, do its job and not do anything else. VSTO offers premium ammo like Hydra-Shok, which does exactly that.

Unfortunately, VSTO is an ugly mess in the markets. Still, if you’re looking for a smart speculation pick, this might fit the bill.

As of this writing, Josh Enomoto did not hold a position in any of the aforementioned securities.


Article printed from InvestorPlace Media, https://investorplace.com/2017/03/3-gun-stocks-boom-concealed-carry-act-rgr-aobc-vsto/.

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