Investors are flocking to one of America’s largest gun makers after Smith & Wesson shattered expectations in its quarterly report on Tuesday. The day before, Smith & Wesson’s shares rose 7.6 percent to $20.44, marking the company’s highest closing price since the same period in 2007.
According to the report, Smith & Wesson’s net sales for the second quarter were $143.2 million, an increase of 32.1 percent over the second quarter last year. The company’s firearm division accounted for $124.9 million and saw a 15.2 percent increase, while its accessories division netted $18.4 million and increased by 24.6 percent over last year.
“Higher revenue in our firearms division was driven by increased orders for our Smith & Wesson SDVE polymer pistols, M&P Shield and M&P Bodyguard polymer pistols, and our long guns, especially our Thompson/Center Venture bolt-action rifles,” said Smith & Wesson Holding Corporation CEO James Debney. “Our accessories division, which was established less than one year ago, also continued to deliver excellent results, with double-digit, year-over-year revenue growth and gross margins that came in above the year-ago quarter.”
The company reported that its profits had nearly tripled in the last quarter, earning a net profit of $14.2 million compared to the $5.2 million last year. According to Bloomberg, gun sales in the United States have grown due to concern over crime and other incidents, such as the terrorist attack that occurred in San Bernardino, California last week. Unlike the 2012 Newtown school shooting, which spurred a surge in gun sales due to worries over gun control laws, analysts claim the recent increase may be due to other factors instead.
“There will be a sustained uptick in gun sales, not necessarily because of the potential laws, but because people are worried about these actual events and being defenseless,” Christopher Krueger, an analyst at Lake Street Capital Markets, told Bloomberg. “Most people know there probably won’t be any meaningful laws passed that would stop them to buy what they want.”
Despite gun control being a key priority for the president in recent years, the Obama administration has failed to pass any significant new firearm-related legislation. Following the San Bernadino attack, in which 14 people were killed by a radicalized married couple, President Barack Obama reiterated the need for “common sense” gun reform.
“We have a pattern now of mass shootings in this country that has no parallel anywhere else in the world,” he told CBS News last Wednesday.
When it was discovered that the couple allegedly supported the so-called Islamic State, Obama pushed to ban gun purchases for any individual on the FBI’s terrorist watch list, which critics have long said is inaccurate and arbitrary. A bill to ban people on the list from purchasing guns was voted down in the Senate last week.
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