Post-Election Results Driving Gun Sale Expectations

Smith & Wesson Holding Corp. (NASDAQ: SWHC) is surging by 7.5% to $10.13, against a 52-week range of $2.72 to $11.24. This one raised guidance before and now it is probably safe to assume that the fourth-quarter gun sales will be boosted by much more than just deer hunting rifles and shotguns to hunt ducks and geese. Sturm, Ruger & Co. Inc. (NYSE: RGR) is up 3% at $45.97, against a 52-week trading range of $29.11 to $58.42.

These two were not included in our sector winners and losers from the 2012 election. That is not because they were overlooked. It is because this is too tiny of a component as far as what investors can really look at.  The total sales projections for 2012 from Thomson Reuters is only about $467 million on Strum, Ruger and almost $537 million for Smith & Wesson.

Alliant Techsystems Inc. (NYSE: ATK) is a defense contractor that has exposure to the fiscal cliff, but it also won a very large munitions contract, which we understand is going to hold up whether or not military spending cuts come. We would still keep that as a tentative, but Alliant is said to be the U.S. bullet king. Its Sporting Ammunition division supplies small-caliber ammunition to federal and local law enforcement agencies, military and sport-shooting, and hunters. Its ammunition brands include Blazer, CCI, Estate Cartridge, Federal Premium, Fusion, Speer and Speer Bullets. Alliant Tech is down, as it is more of a defense contractor per its overall category.

JON C. OGG