From a Barron’s “Streetwise” column on Feb. 28:
“The stay-at-home hobbyist speculator crowd has been manically betting that societal unrest will have us all arming ourselves. The publicly traded handgun makers have had their stocks driven skyward on searing trading volumes.
“Smith & Wesson Holding (SWHC) and Sturm Ruger (RGR) are the main beneficiaries, each up more than 50% in the last seven trading days, in the case of Smith & Wesson on share volume last week that ran at four to five times the daily average. These moves won the stocks’ places in various momentum-screening newsletter services. And at least one major online broker was restricting purchases of Smith & Wesson based on the speculative nature of the price and volume surges, and other possible factors.
“Yes, Sturm Ruger reported good earnings and increased firearms demand last week. And there has been a surge in requests for handgun background checks. This has blossomed into a breathless passed-along online story that tough times are driving people to buy lethal weapons as a precaution. Yet isn’t it a bit more likely that widespread expectation of firmer gun-control laws under the new administration has simply dragged demand forward?”
Barron’s is a the financial publishing firm. To read the rest of the column, click here.
