Gun sales remain strong during the COVID-19 pandemic as Election Day draws closer.
With the president election just days away, prominent gunmaker Sturm, Ruger
“Consumer demand showed no signs of letting up during the quarter as concerns about personal protection and home defense were stoked by civil unrest in some cities around the United States,” said Chief Executive Officer Christopher Killoy in a company statement.
He also attributed the sales boost to “the call, by some, for the reduction in funding and authority of law enforcement organizations, and the continuing COVID-19 pandemic.”
The gunmaker’s stock price was volatile in early trading Thursday, despite the strong earnings reported after the close of trading the night before.
The strong sales have depleted the stock of firearms inventory for Sturm, Ruger as well as retailers across America. “As a result of unprecedented demand, inventories remained significantly reduced at all levels,” said Killoy. He said that the suspension of hiring during the pandemic has “hampered our ability to ramp [up] production,” though the company still reported double-digit gains in increasing manufacturing capacity.
This isn’t just a Sturm, Ruger story. Gun sales have been driven by fears for self-protection during the deadly coronavirus pandemic, as they have throughout the gun industry, according to retailers and analysts. Covid-19 has flattened the economy, infecting 8.8 million Americans resulting in 227,000 confirmed deaths so far. Incidents of police brutality have sparked scenes of civil unrest around the country, including the recent riots in Philadelphia after the police shooting of a Black American, Walter Wallace Jr.
Gun buyers are concerns about calls to “defund the police” by Black Lives Matter and other protestors, and President Trump has exploited this fear to drum up support for his reelection campaign. All of this has prompted first-time buyers to visit gun shops.
Rommel Dionisio, gun industry analyst for Aegis Capital, said in a note to investors that Sturm, Ruger’s strong sales were due to “increased consumer concerns regarding personal safety and self-defense as a result of recent civil unrest, widespread protests, and calls for reduction in funding for various state and municipal police departments.”
He said that Sturm, Ruger, as a leading producer of firearms, was “naturally well positioned to benefit from such overall industry trends.”
Firearms retailers say that new buyers, including women and senior citizens, are buying up guns designed for self-defense, particularly small, compact, semiautomatic pistols, like the LCP line of pistols from Ruger. Ammunition is selling out across the country, leaving shelves bare of bullets.
Background checks conducted by the Federal Bureau of Investigations soared to new heights this year, with a record-breaking tally of 28.82 million for the first nine months. FBI background checks are conducted every time someone tries to buy a gun from a federally-licensed dealer, which includes all gun shops. While the data on background checks is not the same as sales, it serves as the closest nationwide proxy.
Sturm, Ruger is one of the most prominent gunmakers in America, competing primarily with Smith & Wesson. Ruger, based in Southport, Conn., makes a variety of guns, including self-defense pistols like the LCP, bolt-action hunting rifles like the Hawkeye and assault rifles like the AR-556. Hunting got a boost during the pandemic, as social distancing drove Americans towards outdoor pursuits.
Other gun makers include Glock, Sig Sauer, Daniel Defense, CMMG, Standard Manufacturing and Remington, which filed for Chapter 11 bankruptcy protection for a second time in September, selling its Marlin Firearms brand to Sturm, Ruger.
The stakes are high with Election Day nearing. Whoever wins the White House could have a big impact on the future of the gun industry.
President Trump has been endorsed by the National Rifle Association and has no plan for gun control. The Democratic contenders, former Vice President Joseph Biden and Sen. Kamala Harris (D-California,) have a relatively aggressive gun control plan. They propose an expansion of background checks and a ban on the manufacture of assault weapons, like the AR-556.
The irony is that gunmakers could potentially sell more guns in the short term if the White House goes to their sworn enemies, Biden and Harris. But Rommel said retailers and manufacturers have “heightened concerns about the potential tightening of gun control legislation.”
“The election of 2020 is so pivotal, its influence on gun sales can’t be overstated,” said Brian Rafn, a recently retired gun industry analyst for Morgan Dempsey whose family owns shares in Sturm, Ruger.