Shares of American Outdoor Brands Corp (NASDAQ:AOBC) and Sturm Ruger & Company Inc (NYSE:RGR) climbed 10% and 14% respectively on September 19. Stocks rose in response to reports of preparations by the Trump administration to transfer oversight of non-military firearms sales from the State Department to the Commerce Department. U.S. officials said the aim was to slash regulations in order to bolster U.S. exports and create more jobs.
The new rules have been drafted and are reportedly days away from being went to the White House budget office for review and can be pushed through without congressional approval.
American Outdoor Brands Corp released its fiscal 2018 first quarter results on September 8. Net sales were down 37.7% to $129 million compared to $207 million in the first quarter the previous year. The stock has dropped 29% in 2017 and 45% year over year.
Sturm Ruger & Company Inc posted its second quarter results on August 2. The company reported net income of $10.2 million compared to $23.5 million in Q2 2016. Revenue slipped to $131.9 million from $167.9 million.
The election of Donald Trump on November 8 significantly drove down the stock price of both companies. A bitter and contentious election drove up weapons sales but the surprise victory of Trump seems to have dramatically cooled the market. If approved these new rules would come into effect in 2018, just in time for the mid-term elections.
