Market Insider

Smith & Wesson, Sturm Ruger stock prices rise after Orlando massacre

An attendee tries out an M&P 15-22 Sport rifle at the Smith & Wesson booth at the 2016 National Shooting Sports Foundation's Shooting, Hunting, Outdoor Trade (SHOT) Show at the Sands Expo and Convention Center on January 19, 2016 in Las Vegas, Nevada.
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Shares of gunmakers Smith & Wesson and Sturm Ruger gained 6.9 percent and 8.5 percent, respectively, Monday following the massacre in Orlando, Florida.

Authorities said Sunday 50 people were killed, including the gunman, and 53 were wounded during the attack at a gay nightclub in Orlando. Jerry Demings, Orange County sheriff, said the massacre "could definitely be classified as domestic terrorism."

James Hardiman, a Wedbush Securites analyst covering Smith & Wesson, said the stock prices of gunmakers generally rise after such attacks due to increased demands for gun control.

"History would suggest the more awful and tragic the event, ... and as the rhetoric of gun control rises, the stocks go up," he said.

SWHC (blue), RGR (green) Dec. 2-Dec.5

Source: FactSet

Entering Monday's session, Smith's shares were down 2.6 percent year to date, while Sturm's stock had fallen 3.7 percent in the same time period.

Disclosure: Wedbush makes a market in Smith & Wesson.