Shares of the two publicly traded gun makers rallied on Monday, a day after President Barack Obama gave a prime-time address calling for a modest reduction in the availability of firearms.Market Watch also noted that November background checks, an indicator of gun sales though imperfect, were higher than they had been in 20 months and Black Friday numbers set records. Look for that to continue in December. A combination of more people looking to take steps to protect themselves and Obama pushing gun control is a recipe for increased sales.
Smith & Wesson SWHC, +2.25% closed 8% higher and Sturm Ruger & Co. RGR, +5.85% rose 6% on Monday.
Smith & Wesson has climbed 116% this year, and Sturm Ruger has jumped 66%.
Obama on Sunday night said no one on the no-fly list should be able to buy a gun and that it should be harder for people to buy powerful assault weapons like the ones used in the San Bernardino massacre.
But with Congress in paralysis on the issue, the logic on Wall Street is that the increased talk of gun restriction will spur more sales, as has happened in previous instances.
Hat tip to Sebastian.