Photographer: Daniel Acker/Bloomberg

Is Hillary Clinton’s Lead Selling Guns for Smith & Wesson?

Trump’s fading chances, like massacres of children in Connecticut and club-goers in Orlando, are driving firearm lovers to the gun store.

At some point, demand for firearms in the U.S. has to reach a saturation point. We haven’t hit that point yet. 

More than 300 million firearms are already in private hands in this country. But that’s apparently not enough. On Sept. 1, Smith & Wesson Holding Corp. reported a startling 40 percent jump in sales and a doubling of profit for the first quarter of its fiscal year. Chief Executive Officer James Debney credited “strong consumer demand,” as well as Smith & Wesson’s ability to grab more market share.

A more particular theory that I’ve heard from gun industry insiders is that firearm owners have resigned themselves to the election this November of Democratic Party presidential nominee Hillary Clinton. The argument from industry experts like Richard Feldman, president of the Independent Firearm Owners Association, goes that, having concluded Clinton will defeat her Republican opponent, Donald Trump, gun enthusiasts are running out to buy one more firearm before she has a chance to push her oft-articulated gun-control agenda. That includes banning semiautomatic assault weapons, removing liability protections enjoyed by gun manufacturers, and more.

Feldman, based in Rindge, N.H, is a former industry consultant and operative for the National Rifle Association. His view echoes that of Michael Fifer, the CEO of Sturm Ruger & Co., and his chief operating officer, Chris Killoy. Fifer told CNN last month that 2016 is the first time a major party candidate is “actively campaigning against the lawful commerce in arms.” Killoy, who will replace him as CEO next year, said Ruger's recent spike in sales “was fueled in part by the current political climate.”

That analysis is less fanciful than it might sound. Similar thinking on the part of gun owners almost certainly drove what’s known as the “Obama surge”: a gun-buying spree that has spanned almost the entire eight-year tenure of President Barack Obama. The National Rifle Association stoked widespread fear in gun-owning circles that Obama would tighten federal restrictions on the acquisition and ownership of firearms. Republicans in Congress thwarted him in that regard, even after he made a concerted push following the December 2012 Newtown, Conn., elementary school massacre. But despite Obama’s failure, gun sales went up and up and up.

Now the NRA is spending millions of dollars on advertising that attacks Clinton as a “hypocrite” who favors restrictive policies on firearms, but only for the little guy. One new ad aimed at Nevada, Ohio, and other battleground states describes Clinton this way: “Tours the world on private jets. Protected by armed guards for 30 years. But she doesn’t believe in your right to keep a gun at home for self-defense.”  

The main purpose of such advocacy is to boost the electoral chances of Trump, who has warned in his hyperbolic fashion that Clinton will abolish the Second Amendment (Something that requires two-thirds of both Republican-controlled houses of Congress and three-quarters of all 50 state legislatures, the majority of which are controlled by Republicans—though ironically not a presidential signature).

A byproduct of the extended presidential campaign has certainly been a robust firearms sector, led by Smith & Wesson, which posted first-quarter sales of $207 million, compared with $148 million in the same quarter a year ago. The company had net income of $35.1 million, up from $17.7 million. 

One thing remains clear: Whether the NRA ads succeed in helping Trump or not, the organization’s fear mongering about Clinton and gun control may well be sending people to their local firearm shop—where they’re boosting the fortunes of Smith & Wesson and its rivals.

Before it's here, it's on the Bloomberg Terminal.