Looks like a great presidential win for gun owners was a loss for some in the firearms industry…. Ruger, Smith & Wesson stock prices fall sharply on Wednesday following the election.
Firearm stocks opened high Wednesday, but just a few hours into the trading day, began steadily dropping, and by the close of the day, two major manufacturers saw sharp declines in their share prices. Newly-renamed Smith & Wesson took a major hit, falling 15% in value. Sturm, Ruger & Company showed a 14% decline in market value.
Even though Smith & Wesson and Ruger shares fell, some ammunition and defense corporation prices climbed. Olin Corporation (Winchester Ammunition) saw a 3% increase, General Dynamics climbed 8%, and Lockheed Martin ended Wednesday with a substantial 14% gain.
Overall, the Dow skyrocketed 257 points Wednesday, following an initial, but brief, price plunge. Market analysts credit president-elect Trump’s assuring acceptance speech for the soaring end to the day.
A note Wednesday from analyst Gil Luria (Director of Research for Wedbush Securities) stated that the election results are good for the “long-term viability of the [gun manufacturing] industry.” But. The Trump victory bundled with a Republican Congress, could be a net-negative for Smith & Wesson and others as it “eliminates any realistic fear of gun regulation,” Luria wrote. According to the note, threats of restrictive gun regulations had been a major force driving higher volume firearms sales over the last eight years.
The Trump victory was no doubt assisted strongly by efforts by NRA supporters. Given that the NRA has been accused of having “morphed from an advocacy group for hunters into a radical mouthpiece for its largest benefactors, the gun manufacturers” (from a letter published in the LA Times) looks like individual rights and profits might for a time better exist higher and lower, respectively. What matters is the long run.