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Fri Jun 10, 2016, 06:46 AM

 

Gun Stocks Face a 2D Problem: Demand and Donald Trump

What do background checks and Donald Trump have in common? Both are gauges of potential trouble brewing for publicly traded gun stocks.

At the end of last week, the Federal Bureau of Investigation released information that background checks for firearm sales fell to an eight-month low. That effectively translates into lower demand for guns, and therefore, lower valuations for gun stocks.

At the same time, Donald Trump is making unnecessary news, drawing concerns among gun rights activists that a Republican will be denied the White House once again.

Should investors of gun stocks be concerned about these latest developments?

http://investorplace.com/2016/06/gun-stocks-faswhc-rgr-vsto-donald-trump/

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Arrow 22 replies Author Time Post
Reply Gun Stocks Face a 2D Problem: Demand and Donald Trump (Original post)
SecularMotion Jun 2016 OP
Duckhunter935 Jun 2016 #1
ileus Jun 2016 #2
Duckhunter935 Jun 2016 #3
Lizzie Poppet Jun 2016 #9
melm00se Jun 2016 #4
OldRedneck Jun 2016 #5
jmg257 Jun 2016 #6
Logical Jun 2016 #7
jmg257 Jun 2016 #8
ileus Jun 2016 #11
jmg257 Jun 2016 #12
beevul Jun 2016 #15
Logical Jun 2016 #17
DonP Jun 2016 #18
Straw Man Jun 2016 #10
beevul Jun 2016 #13
Eleanors38 Jun 2016 #14
DonP Jun 2016 #16
GreydeeThos Jun 2016 #19
benEzra Jun 2016 #20
jmg257 Jun 2016 #21
beevul Jul 2016 #22

Response to SecularMotion (Original post)

Fri Jun 10, 2016, 06:49 AM

1. No, because Hillary willl win

 

And she has called for looking at gun confiscation and bans. Gun sales will go through the roof.

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Response to SecularMotion (Original post)

Fri Jun 10, 2016, 06:50 AM

2. My favorite gun stock for AR is the Magpul MOE series.

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Response to ileus (Reply #2)

Fri Jun 10, 2016, 06:51 AM

3. They do make great products

 

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Response to ileus (Reply #2)

Fri Jun 10, 2016, 11:48 AM

9. I'm a Manners gal.

 

Manners Elite Tactical ftw! For us bolt gun weirdos...

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Response to SecularMotion (Original post)

Fri Jun 10, 2016, 07:44 AM

4. i am curious

according to the article:

But the argument is much more nuanced. While permits for handgun sales have steadily increased over the years, long gun permits are no longer the majority of total firearm permits issued.


I find this claim...troubling. From what I can see, only 7 (CA, CT, DC, HI, IL, MA and NJ) states require "long gun permits", so making the claim that "long gun permits are no longer the majority of total firearm permits issued" from a population of 7 of 50 states. This claim becomes even more suspicious when the number of states requiring pistol purchase permits is double (14: CA, CT, DC, HI, IL, IA, MD, MA, MN, NE, NJ, NY, NC and RI) that of states requiring long gun permits.

Am I missing something here?

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Response to SecularMotion (Original post)

Fri Jun 10, 2016, 08:33 AM

5. I'm a little cautious of this claim

 

As another comment points out, a lot of states do not require permits to purchase weapons. The cited article seems to rely on background check data. What about raw sales data?

This article from January 2016 shows total firearms sales rapidly increasing as of the end of 2015 -- did that trend suddenly collapse?

https://www.washingtonpost.com/news/wonk/wp/2016/01/05/gun-sales-hit-new-record-ahead-of-new-obama-gun-restrictions/

New federal data shows 2015 was a record-smashing year for the American firearms industry, with gun sales appearing to hit the highest level on record. Background checks for gun purchases and permits jumped 10 percent last year to 23.1 million, the largest number since the federal background check system began operating in 1998.

. . .

One point of caution with the FBI's numbers: The agency stresses that you can't draw a one-to-one correspondence between "background checks" and "gun sales." The numbers include background checks for gun permits, too, which may or may not be accompanied by a sale. Different states have different procedures in place for running permit checks, as The Washington Post's Philip Bump notes here. Some unknown but likely significant percentage of gun transactions don't involve a federally licensed dealer and hence aren't accompanied by a background check at all. (Obama's rules, which he formally announced Tuesday, would require more gun sellers to be licensed and conduct background checks.)

Still, the FBI's figures provide a useful approximation of overall gun transactions in this country. And they strongly indicate that 2015 was a great year for gun manufacturers.

One interesting wrinkle is that national surveys indicate that the number of households owning firearms is either flat or trending downward, depending on whether you prefer measurements by Gallup or the General Social Survey. If gun sales are increasing, as these numbers from the FBI and different data from the Bureau of Alcohol, Tobacco, Firearms and Explosives suggest, the implication is that most of the growth in the firearms industry is coming from existing owners stocking up on more guns, rather than new purchasers buying for the first time.


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Response to SecularMotion (Original post)

Fri Jun 10, 2016, 09:56 AM

6. Seems like a very good time to buy stock in gun companies.

The election will drive sales up again, plus the normal cycles of the past decades as we move through the summer into fall/winter.

Last winter, which is always a high-tide mark for sales, there were plenty of 1st time buyers at the various gun stores.

This current "lull" follows just about all the previous years going back to 1998, but annually the over-all numbers just trend higher and higher.

https://www.fbi.gov/about-us/cjis/nics/reports/nics_firearm_checks_-_month_year.pdf

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Response to SecularMotion (Original post)

Fri Jun 10, 2016, 10:05 AM

7. It cracks me up how easy it is to make gun fans panic, shit, i would pay trolls....

 

To post on gun forums to increase sales.

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Response to Logical (Reply #7)

Fri Jun 10, 2016, 10:24 AM

8. Hey - any excuse is a good excuse to buy another gun! nt

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Response to jmg257 (Reply #8)

Fri Jun 10, 2016, 12:42 PM

11. I have two lowers I need to complete before the Hillary panic hits

Of course the panic may hit about August when it's evident she has a commanding lead and Trump is going to lose.



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Response to ileus (Reply #11)

Fri Jun 10, 2016, 12:46 PM

12. Permits are backed up from this latest "lull", so picking up the new Sig is taking longer

then ever.

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Response to Logical (Reply #7)

Fri Jun 10, 2016, 02:19 PM

15. The best, most effective method for that type of trolling...

 

It cracks me up how easy it is to make gun fans panic, shit, i would pay trolls....To post on gun forums to increase sales.


The best, most effective method for that type of trolling, would be to parade around advocating gun bans, I would think.

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Response to beevul (Reply #15)

Fri Jun 10, 2016, 04:07 PM

17. no, just say hillary will shut down the ammo factories, gun idiots believe that shit so easy. nt

 

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Response to Logical (Reply #17)

Fri Jun 10, 2016, 05:33 PM

18. Or a 5 cent surcharge on every center fire round and a penny on every rimfire round, oh wait ...

 

They're actually doing that in Cook County now, plus a $25 surcharge on ever firearm sold to support "Gun control efforts".

And it's workin' like a charm.

Don't need to make shit up, stupid, clueless gun grabbers do a fine job all by themselves of driving sales.

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Response to SecularMotion (Original post)

Fri Jun 10, 2016, 12:12 PM

10. An "eight-month low"?

After several years of all-time-record-breaking sales? Somehow I doubt that the gun industry is quaking in its collective boots.

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Response to SecularMotion (Original post)

Fri Jun 10, 2016, 01:10 PM

13. Its an 8 month low because of the 8 record months previous.

 

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Response to SecularMotion (Original post)

Fri Jun 10, 2016, 01:40 PM

14. Ruger stock 2006: $6/share. Ruger stock 2016: $57/ share.

 

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Response to Eleanors38 (Reply #14)

Fri Jun 10, 2016, 02:47 PM

16. Selling all that evil gun stock, smart move for municipalities and colleges

 

Nice politically correct symbolism ... that cost them millions in earnings and didn't save one life.

I wonder if the brain trust that decided that "symbolism over substance" was a good investment strategy are going to reimburse the shareholders and cover the pension shortfalls?

Nah! Probably about as likely as our gun control friends will ante up with their own money to support their mistakes and "beliefs".

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Response to SecularMotion (Original post)

Fri Jun 10, 2016, 05:51 PM

19. OH MY. The Gun Bubble is about to burst!

Soon the market will be flooded with people selling off their stockpiles of guns to avoid the looming crash in gun prices. The gun speculators that bought up hundreds of tactical rifles and premium grade handguns are going to lose their fortunes overnight.

Remember, do not buy on the anticipation of higher prices; only buy for increasing value.

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Response to SecularMotion (Original post)

Sun Jun 12, 2016, 01:17 AM

20. That's funny, since this past April was *the highest April on record*.

I also notice from your own chart that rifle sales have returned to a "new normal" that is greater than rifle sales in all of previous U.S. history prior to the 2011-2012 run-up.

Of course, if you want to turn that chart around and send rifle sales through the roof again, make a serious push to ban them again and watch sales surge.

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Response to SecularMotion (Original post)

Sun Jun 12, 2016, 11:16 AM

21. Don't think it'll be an issue now. nt

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Response to SecularMotion (Original post)

Mon Jul 4, 2016, 01:36 PM

22. Kicking due to recent developments. N/T

 

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