…remember they are seasonality plays into 2013, as I discussed at-length in this blog post.
Now, the issue is whether the fallout from the Sandy Hook shooting will adversely impact SWHC (and RGR). We can speculate all we want on what type of legislation will be introduced, let alone passed, in Washington.
For now, I am letting the selling run its course in these stocks and figure a better entry is approaching into the seasonally very strong months to start next calendar year. This is one of those instances where you really have to force yourself to separate your politics and emotions from trading, if you choose to get involved with these stocks.
Not having the sales statistics for SWHC, this is just some food for thought, but it seems all the regulatory talk is about rifles, rather than handguns. Smith and Wesson products are mostly handguns, and of those, quite a few are revolvers, which seem not to have been mentioned at all. As such, how much of an effect would more restrictive regulations have, even if any are passed, which I doubt will happen?
Looking for lots of talk and little action. Thoughts?
Montrose…..$SWHC is mostly revolvers but also a large line of assault style rifles as well. Here are a couple of other thoughts….Large margins in AR-15s due to a large amount of plastic. Secondly, for a company like $RGR who is not only big in assault rifles but also ammunition for the .223. A week ago 1000 rounds selling for $400. Just under 50% total cost of gun.Third, have you been to a Pawn Shop lately? Slam full of used guns. Who is buying new guns in this economy unless it is a highly specialized style gun? These companies were valued on pre-Newtown conditions, regulations, & sentiment. Unfortunately all have changed…..too what degree is unknown. Just food for thought
ps…Oh yeah what about all those insider unloading RGR in the past 3-4 weeks pre special dividend? This stock is up 500% since O took office in ’08