American Outdoor Brands Corp. dropped to a two-year low after the maker of Smith & Wesson firearms lowered its annual profit target and said steep price cuts would continue for the near future.
Gunmakers aren’t reducing production enough to meet lower demand, Chief Executive Officer James Debney said on a conference call with analysts. Fear-based motivation for purchases has been replaced by the search for bargains, he said.
“We have to defend our position and weather the storm -- ultimately until there’s a better balance between those production rates and the consumer demand,” he said after the close of regular trading Thursday. It’s unclear how long the discounting will continue, he said.
The price pressure reflects the changing political environment under President Donald Trump, who has vowed to protect the right to bear arms. Firearm sales often spiked after mass shootings during President Barack Obama’s administration, as some customers feared that lawmakers would respond with tougher gun-control measures.
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Nothing like a black man in the White House to make certain folks insecure, I guess.
