Two of the top gun stocks in the United States have been reeling since the election of Donald Trump. These companies have also had to contend with more pressure in the wake of increased mass shootings in the United States.
This has sparked calls for significant gun reform.
The election is going to be a factor for gun stocks as we look ahead to 2020. Gun sales shot up after the election of Barack Obama. If another Democrat is elected in 2020 it could generate similar anxiety about the future of availability.
American Outdoor Brands (NASDAQ:AOBC) is a top manufacturer of firearms. Shares have plunged 52% in 2019 as of close on September 6.
The stock plunged after it posted a second-quarter loss of $2.1 million or $0.04 per share, compared to net income of $7.6 million or $0.14 per share in Q2 2018. Still, the stock boasts a forward price-to-earnings ratio of 7.6 and a favourable price-to-book of 0.7. Shares had an RSI of 27 at the time of this writing, putting American Outdoor in technically oversold territory.
Sturm Ruger & Co. (NYSE:RGR) is engaged in the design, manufacturing, and sale of firearms. The stock has dropped 20% in 2019 so far. In the second quarter, earnings came in at $6.23 million or $0.35 per share compared to $15.19 million or $0.86 per share in the prior year. Shares have a P/E ratio of 18.2 and a P/B of 2.6.
