© Reuters 2 Gun Stocks Wall Street Predicts Will Rally by More Than 20%
The resumption of outdoor activities as distancing restrictions have eased, along with fears surrounding the potential for stricter gun laws, have increased the demand for guns. A significant spike in pre-sale background checks is an indication of a surge in gun sales. Thus, Wall Street analysts are bullish about financially sound gun stocks Vista Outdoor (NYSE:) and Sturm, Ruger and Company (RGR). Based on consensus price targets, these two stocks could rally 20% or more over the next 12 months. So, they could be solid bets now. Read on.As the U.S. continues to make strides in vaccinating its population against COVID-19, activities such as shooting and hunting have returned, resulting in an increasing demand for guns. In addition, gun purchases have risen significantly this year, with many buyers stockpiling guns in anticipation of stricter firearm restrictions under the Biden administration. According to the National Shooting Sports Federation (NSSF), more than two million of the pre-sale background checks in March were for new gun purchases.
The global ammunition market is expected to hit $28.37 billion by 2028, growing at a 3.6% CAGR. Also, small-caliber ammunition penetration is likely to rise in the future due to the growing popularity of sports that use handguns. Gun retailers are expected to witness a substantial surge in sales of rifles too, due to increasing participation in shooting events and increasing consumer interest in hunting activities.
So, Wall Street Analysts are optimistic about the upside potential of several fundamentally sound gun stocks. Two such stocks that they expect to rally more than 20% over the next 12 months are Vista Outdoor Inc . (VSTO) and Sturm, Ruger and Company Inc. (RGR).
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