Gun Stocks Continue To Rise: Thanks, Obama

• Shares of Smith & Wesson Holding Corp SWHC hit a new 52-week high on Tuesday of $21.46.
• Meanwhile, shares of Sturm, Ruger & Company RGR gained more than 10 percent over the past five days.
• Various media reports are correlating the strong performance seen in gun manufactures' stocks to President Barack Obama's address to the nation on December 6 and the recent massacre in San Bernardino, California.

Shares of Smith & Wesson is now higher by more than 115 percent over the past year, while Sturm, Ruger & Company has gained more than 50 percent over the past year.

Both Smith & Wesson and Sturm, Ruger & Company manufacture and sell popular versions of concealed carry pistols and revolvers.

According to a report by Breitbart, the White House is eyeing the massacre in San Bernardino to "float the idea" that President Obama could use his executive authority on gun control prior to the end of his Presidential term.

In fact, Obama also said during a televised address to the nation: "I know there are some who reject any gun safety measures, but the fact is that our intelligence and law enforcement agencies, no matter how effective they are, cannot identify every would-be mass shooter, whether that individual was motivated by ISIL or some other hateful ideology. What we can do and must do is make it harder for them to kill."

As Obama hints of upcoming tighter gun control, several gun store owners are seeing an immediate spike in sales.

"With Obama making the statement that he wants to change legislation, get it to where its harder for the public to purchase high-capacity firearms, folks are going to start running to get what they can get ," Clay Ausley, owner of North Carolina-based Fuquay Gun & Gold told WRAL, a local media publication. "The heaviest hitters have been ammunition and high-capacity magazines. The AR mags, the AK mags - they have been flowing out of here like water."

Gun Investors Have Seen This Story Play Out Before

Investors with exposure to gun manufactures shouldn't find it surprising that Obama's words and actions is directly contributing to a surge in gun-related stocks. This theory holds true because it is similar to what has been observed in recent years.

Obama pressed unsuccessfully for stricter gun controls, particularly following the Sandy Hook Elementary School shooting in December 2012.

"Obama is the stimulus package for the firearms industry," Dave Workman, senior editor of Gun Mag, a print and online publication of the 2nd Amendment Foundation, a gun-ownership rights group, told Bloomberg back in 2014. "The greatest irony of the Obama administration is that the one industry that he may not have really liked to see healthy has become the healthiest industry in the United States."

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