Stock traders suspect that the gun sales boom may be drawing to a close.

Shares of the nation’s major firearms makers fell Monday on analyst concerns that the postelection surge in hand gun sales may be coming to an end.

Both Sturm Ruger & Co. Inc. and Smith & Wesson Holding Corp. declined following an article in the business publication Barron’s, which suggested that the companies could see slowing consumer demand for their firearms.

The news dragged stocks lower, but it wasn’t completely unexpected, said Cai von Rumohr, an analyst with Cowen and Co.

“This has been the concern ever since the gun sales started to pick up,” he said in an interview.

Everyone knows that the surge can’t keep up forever. The recent year-over-year growth rates of 15% are solid but not outrageous.

Not only will demand likely slow, but ramped up production of guns and ammunition could lead to a lowering of sometimes-crazy prices. And store stocks should get back to where you actually have a choice.

Topic under discussion at Say Uncle and Snowflakes.

This entry was posted on Wednesday, June 24th, 2009 at 3:59 pm and is filed under Industry News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.