Black Friday background checks boost share prices for gun makers

The record-breaking number of background checks processed on Black Friday translated into boosted share prices this week for major gun makers.

Stocks for American Outdoor Brands and Sturm, Ruger and Co. climbed more than 3 percent Monday amid reports of gun dealers submitting more than 200,000 applications through the National Instant Criminal Background Check System during the annual shopping frenzy last week.

Black Friday — a traditional boon for the gun industry as of late — tops the FBI’s list of 10 busiest days for the third year in a row. According to the agency’s data, six of its highest ranking days fall on the shopping holiday and all but one occur within the the month-long period between Thanksgiving and Christmas

The sales surge comes as welcome news to the industry’s most prolific manufacturers and retailers after a year of double digit losses.

Gun dealers submitted just over 20 million applications to NICS through Oct. 31 — about 9.5 percent behind 2016. Estimated gun sales — the sum total of applications submitted to the federal system for its handgun, long gun, multiple and other categories — surpassed 10.1 million last month. Compared to last year, sales declined 12.5 percent.

The numbers reflect an industry still re-calibrating under “a new normal.” President Trump’s victory stunned gun makers and retailers alike, many of whom amassed inventory in preparation for a Democratic electoral sweep and the heightened demand it would bring.

Instead, prices tanked as dealers tried to unload product throughout the year. Background checks ebbed and flow more in line with historical trends — a steady sales uptick in winter that bottoms out over the summer, resuscitated in the fall as hunting seasons kick-off.

The industry’s most profitable weeks — aside from short bursts of demand following mass shootings, terror attacks or congressional action — set in Black Friday and will extend throughout the holiday shopping season.

Dealers processed 5.3 million applications in November and December 2016, alone — representing about one-fifth of the 27.5 million NICS checks completed last year, the biggest in the system’s two-decade history.

Similar numbers would place 2017 about 2 million checks behind last year, making it the second busiest on record for NICS.

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