American Outdoor Brands Corp AOBC traded lower on Monday and Sturm Ruger & Company Inc RGR traded lower after the FBI released numbers showing a 20-percent month-over-month decrease in background checks conducted through the National Instant Criminal Background Check System.
What Happened
April 2018 background checks showed a year-over-year increase and highest value for the month of April since 1998. Background checks in March were close to the record level for a single month.
Why It's Important
Although there is a strong seasonality in background checks, the month-over-month decline in April was the highest since 2014, when they declined almost 30 percent. In the last three years, the decline was around 15 percent. Despite the month-over-month decline in April, background checks are already 7 percent higher in the first four months of 2018 than in the first four months of 2017.
What's Next
The decline in background checks typically continues in May, June and July, with the exception of 2016, when they ticked higher in June. The checks usually move higher in August and are the highest in the last two months of a year.
American Outdoor Brands Corp. was down 1.48 percent at the time of publication Monday. Sturm Ruger & Co. was down 0.43 percent.
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