- Gun sales soared in April and May compared with the same periods in 2019.
- A proliferation of unrest throughout the country could be behind the surge, one Wall Street analyst said.
- A win by former Vice President Joe Biden, who has a stricter stance on guns, in November could also bolster demand, the analyst said.
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Massive protests on the back of a pandemic that’s killed more than 100,000 Americans have caused a surge in new gun buyers that could continue as former Vice President Joe Biden’s electoral polling numbers increase over President Donald Trump’s.
Federal background checks increased 75% in May compared with 2019, a further acceleration from April’s 69% gain over the previous year, according to Cowen research. Handguns, in particular, were up 94%. Background checks are largely considered a proxy for gun purchases in the absence of more granular sales data.
“The pick up in civil unrest could bolster near term gun demand,” Cai von Rumohr, an analyst at Cowen, said in a note to clients Tuesday as gun stocks continued to outperform market indexes.
The largest gun manufacturers have handily outperformed the benchmark S&P 500 index since its most recent low on March 23. Smith & Wesson Brands, formerly known as American Outdoor Brands, is up 72% in that time, with Sturm Ruger and Vista Outdoor up 52% and 40%, respectively, compared with the index’s 37% gain.
That streak could continue as Joe Biden’s candidacy gains further ground on Trump for November’s general election, Cowen said.
“While COVID-19 lock-downs are starting to ease, gun demand could remain strong as civil unrest increases with the George Floyd protests,” it said. “Moreover, gun demand likely also would be bolstered if Biden’s election prospects strengthen given his more restrictive stance on gun control.”
The most recent YouGov general-election poll from June 1 showed a 4-point lead for Biden over Trump.
In a Philadelphia speech on Tuesday, Biden said the Black Lives Matter protests that have swept the nation and precipitated curfews in many of the largest cities were a wake-up call.
“I won’t traffic in fear and division. I won’t fan the flames of hate,” he said. “I will seek to heal the racial wounds that have long plagued this country – not use them for political gain.”
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