President Obama’s move to tighten gun restrictions follows a string of high-profile shootings and surging sales of firearms — and some experts believe Tuesday’s executive action will only heighten demand.
Gun manufacturers have seen their stocks climb in recent days as sales pick up.
Shares of Smith & Wesson jumped 11 percent Tuesday, to $25.86, when the president unveiled his new plan for expanding background checks on gun sales, while Sturm, Ruger & Co.’s stock climbed nearly 7 percent, to $65.54.
For gun-rights groups, the numbers serve to validate a long-running joke within the industry: Obama is the gun salesman of the year.
“President Obama has single-handedly done more to promote gun ownership than anyone else,” said Erich Pratt, executive director of the Gun Owners of America.
“Gun owners are concerned, and they should be,” Pratt continued. “We see people running to gun stores to buy firearms and ammunition.
“If Obama wants to ban it, they want to buy it,” he added.
The president announced his latest gun control push in October, but the new restrictions on firearms were only unveiled Tuesday. They will include a requirement for more gun dealers to conduct background checks.
This signals a renewed effort by the administration to address gun violence amid a spate of recent mass shootings.
But the gun orders may not immediately have the desired effect. As in previous cases, high-profile shootings — and the accompanying push for strong regulation — are resulting in increased sales.
The phenomenon only adds to manufacturers’ bottom lines.
Amid reports of the president’s executive action on guns, Smith & Wesson raised its sales forecast by 16 percent on Monday.
Smith & Wesson’s stock has soared nearly 50 percent since Obama first floated the idea of taking executive action on guns back in October. Shares of Sturm, Ruger & Co. have risen at a decent pace of about 13 percent since that time.
“In the near term, some people will use this as an excuse to get to the store and buy guns,” said Chris Krueger, a research analyst at Lake Street Capital Markets, where he tracks Smith & Wesson.
“Some gun shops actually hang pictures of President Obama on the wall, calling him the ‘salesman of the year,’ ” Krueger added.
Though concerns over gun control may subside in the long term, the rising threat of mass shootings and home-grown terrorism is driving others to purchase guns, Krueger said.
The FBI was flooded with a record number of requests for background checks last year, including more than 3.3 million in December, following the terrorist attacks in Paris and San Bernardino, Calif.
The market research firm IBISWorld predicts the gun orders — combined with the perceived threat of terrorism — are behind the recent “surge in demand for guns and ammunition.”
“Obama’s executive order might actually further increase demand for guns and ammunition, because consumers’ anxiety of stricter gun control regulations may prove partially well founded,” IBIS wrote in a research note.
“The recent spate of shootings around the United States, combined with the gun regulation rhetoric of the presidential primaries and the holiday shopping season, have pushed demand for guns and ammunition to new heights.”