Newtown Shootings Jolt Thriving U.S. Gun Industry; NRA Breaks Silence


The thriving U.S. gun industry, riding high on a surge in sales, is under increasing pressure after Friday’s elementary school massacre, reports the Wall Street Journal. Private-equity firm Cerberus Capital Management is seeking to sell the company that manufactures a gun used in last week’s shooting in Connecticut. Responding to a national wave of revulsion over the 27 murders in Newtown, Ct., retail chain Dick’s Sporting Goods Inc. suspended sales of semiautomatic rifles at its 480 stores, while Wal-Mart Stores deleted from its website a listing for one such rifle.

Shares of gun makers and some retailers have been affected. Smith & Wesson Holding Corp., whose stock had nearly doubled this year, fell 10 percent on Tuesday to $7.79. Shares of Sturm, RugerRGR fell 7.8 percent to $40.60. The National Rifle Association, breaking days of silence, said it is “shocked, saddened and heartbroken” by the Newtown shooting. “The NRA is prepared to offer meaningful contributions to help make sure this never happens again.” The gun makers and small gun retailers have relied primarily on the NRA to lobby against gun restrictions. U.S. gun manufacturers have enjoyed fast-growing sales amid an easing of various state and federal restrictions. Making guns can be very profitable, with some leading manufacturers recording operating profit margins of 20 percent recently.

Comments are closed.