Mystery company buying up U.S. gun manufacturers

[SunnySlopes]

Believe it or not, most gun makers are small-cap companies at best. I can only think of 1 off hand that has revenues of over 1billion and that is Ruger. They are not "big business" the way anti's suggest. I believe that Smith and Wesson is a $600 Million per year company... Peanuts.

Sort of. The fact is that in America, only Smith and Wesson and Ruger are publically traded, so it's really impossible to know what's going on with, say, Jennings or Bryco. Winchester is publically traded but apparantly it's wrapped up in other non-gun items w/Olin, Inc. I don't have the time or inclination to research their gun division separate from the rest.

For 2010, Smith and Wesson had $406 million in sales with an adjusted net income of $32 million. That compares with an adjusted net from 2009 of minus $64 million. 2008: an adjusted net income of $9 million.

Their future looks bad. They had a spike in sales because of Obama, but that's cooled off. Their only hope is that he gets re-elected cause that fuels gun purchases.

Looking at profitability, liquidiity and investor ratios of S&W compared to Ruger, Ruger is in much better shape. Still, Ruger's figures as a corporation aren't such as to necessarily attract the attention of multinational investment conglomerates.

I honestly wonder why anybody would be in the gun business, from an investment point of view.

 

[JohnBT]

Speaking of gunmakers, I think you've confused Winchester ammo/Olin with Winchester rifles. The Winchester firearms license is owned by Herstal Group which is owned by the Walloon regional government. They bought Browning in 1976 and later acquired USRAC. Olin has licensed the name for many decades.

www.ft.com/cms/s/0/78874cf4-f042-11df-88db-00144feab49a,s01=1.html#axzz1gMVND5Tb

Global sales of Herstal Group was $621m in 2009. I would have guessed more, given that they provide 3/4ths of the U.S. military's small arms.

 

[SunnySlopes]

Your link shows nothing re Winchester, be it Olin or Winchester rifles. Are you saying Winchester rifles is publically traded? What is their stock symbol?

Global sales of Herstal Group was $621m in 2009. I would have guessed more, given that they provide 3/4ths of the U.S. military's small arms.

That's way above any figures re net profit. Like I said, I'm amazed anybody would fool with guns, from an investor's point of view.

Ok, I just checked them out. I was unaware of the Herstal "group." They're located in Belgium which means their financials aren't subject to scrutiny by GAAP standards. Plus, their firearms divisions are all rolled into various other enterprises.

 

[MachIVshooter]

Either they pretty much have a monopoly on imported milsurp semi-auto kits, or they survive because the products' prices attract plenty of buyers who don't know about "alleged" outsourcing quality problems in the past, or they just figure that gambling their hard-earned cash on a gun is worth it.

One, they do almost have a monopoly on many things.

More importantly, their reputation is well known; Mediocre guns at moderate prices. People buy Century stuff expecting to get what they paid for.

Remington, on the other hand, has always been known for (moslty) very high quality products, and the prices do reflect that. If you cut quality but retain price, people will look for a better value. When a Remington 700 becomes no better than a Stevens 200, why on earth would you pay 2-1/2 times as much for the Remington?

I'm a Remington and Marlin guy, have 13 of one and 8 of the other. Would I buy one of either produced today? Unlikely, at least not without very thoroughly inspecting it.

 

[SSN Vet]

IIUC, Winchester only exists today as a marketing trade name.

The Winchester ammo. trade name is owned by Olin (and has been for years)

The Winchester Rifles trade name is owned by FN Herstal, who bought U.S. Repeating arms and after investing a boat load of money into the CT plant (and losing almost all of it), shut down the plant. By contract with the union that formerly owned USRA, FN could not make model 700 and model 94 rifles and model 1200/1300 shotguns at any other facility for a period of time. That period of time has passed and arguably the best model 700s ever are being produced at the FN plant in NC, and some high quality special edition 94s are being produced in Japan.

Winchester as an American manufacturing company is dead, but at least the name is no longer attached to the "iffy" USRA product that the union owned company in CT spit out.

 

[JohnBT]

"Your link shows nothing re Winchester"

That's funny, it did right after I posted it. I always check my links.

"Are you saying Winchester rifles is publically traded?"

No, I said "The Winchester firearms license is owned by Herstal Group which is owned by the Walloon regional government."