Tags: sturm | ruger | guns | stock

Motley Fool: Sturm, Ruger Only 'Pure' Gun Stock to Buy

Motley Fool: Sturm, Ruger Only 'Pure' Gun Stock to Buy

(Getty/Dennis Flaherty)

By    |   Thursday, 02 February 2017 07:52 AM

If you are a savvy and die-hard firearms supporter, there is really just one bullet left in the chamber of your gun-stock buying options.

Sturm, Ruger remains the only pure-play gun stock you can buy now that one-time rival Smith & Wesson has decided to pursue the rugged outdoors market and change its corporate identity, the Motley Fool reports.

"According to the latest data available from the Bureau of Alcohol, Tobacco, Firearms & Explosives, Ruger was the largest gunmaker in the U.S., producing over 1.7 million firearms in 2014, ahead of the 1.4 million made by Remington, and better than the 1.3 million guns made by Smith & Wesson (however, it slips to second place behind Smith & Wesson if we're just talking about handguns)," the Fool reported.

"To put that in perspective, it means almost one of every five guns made that year was a Ruger. Sturm, Ruger is one of the premiere gunsmiths today," the Fool explained.

"It produces everything from pistols and revolvers to rifles and shotguns, and its rimfire handguns and long guns are among the most popular on the market," it said.

"Ruger (NYSE:RGR) trades at just 11 times trailing earnings and 13 times next year's estimates, and shares sit 33% below their 52-week high hit last summer. With an enterprise value that trades at a bargain-basement 11 times its free cash flow, it's clear Sturm, Ruger is a deeply discounted stock that is waiting for a simple catalyst to send shares soaring."

To be sure,  shares of firearm makers have tumbled since Donald Trump’s presidential election amid predictions that consumers will slow down weapon purchases with a Republican in the White House.

“Firearm makers have profited during the nearly eight years of Barack Obama’s administration on fears — misplaced, in the end — that he would tighten gun controls. So great were the concerns that firearm sales tended to jump after mass shootings such as the 2012 Newtown school massacre,” the Financial Times reported.

“The trend continued this year as polls putting Democrat Hillary Clinton ahead in the presidential race prompted heavy gun buying. To the end of November this year, the Federal Bureau of Investigation has performed more than 13m background checks involving firearm sales — nearly as many as for all of 2015, including the Christmas shopping season,” the FT reported.

(Newsmax wire services contributed to this report).

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Ruger is a deeply discounted stock that is waiting for a simple catalyst to send shares soaring.
sturm, ruger, guns, stock
Thursday, 02 February 2017 07:52 AM
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