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Dimming expectations that the US will restrict gun ownership, despite a string of mass shootings, has had an effect on the nation’s gun manufacturers, whose sales, profits and share prices are falling.

Gunmaker stocks declined on Friday after Smith & Wesson parent American Outdoor Brands cut its earnings forecasts for the year following a sharp drop in quarterly sales.

Sales had boomed last year ahead of a presidential election that many thought would be won by Hillary Clinton, who would pursue legislation to limit firearms — but those concerns have fallen away.

“There is no fear-based buying right now,” said James Debney, chief executive of American Outdoor.

The Massachusetts-based company lowered its fiscal full-year revenue outlook to a range of $650m to $675m, from $700m to $740m previously, as retailers cut gun prices to attract customers.

At that revenue range, the company now expects adjusted earnings of between 57 to 67 cents a share, down from $1.04 to $1.24 a share previously.

“Total firearms revenue for the quarter faced a challenging comparison to last year when we believe strong consumer demand was driven by personal safety concerns and pre-election fears of increased firearm legislation,” Mr Debney said on the earnings call.

“We believe that the level of promotional activity . . . has really replaced the fear-based buying as the primary driver for a consumer who wants to acquire a firearm.”

American Outdoor shares fell as much as 16.5 per cent to $12.46 — its lowest intraday level in more than two years — but trimmed those losses to trade 12.5 per cent lower by early afternoon.

Its bearish outlook also weighed on Sturm, Ruger & Co, whose shares were down 8 per cent at $51.25.

Friday’s sell-off took the decline in American Outdoor shares since last year’s election to more than 50 per cent. By contrast, the company’s shares rose almost 500 per cent during President Barack Obama’s two terms in office, when customers feared tighter gun control following mass shootings.

American Outdoor said it had reduced production to help lower inventories and better balance its output with demand, even as it prepares to introduce new products.

Its fiscal second quarter net sales were down 36.4 per cent from a year ago to $148m, although they were ahead of analysts’ estimates of $142m, according to a Thomson Reuters survey.

Net income declined to $3.2m from $32.5m in the year ago quarter. That translated to earnings per share of 6 cents a share, compared with 57 cents a share a year earlier.

The company said it expected discounting to continue for the “foreseeable future”, and noted that there was significant activity in the US on Black Friday, the day after Thanksgiving when retailers traditionally offer discounts.

“The positive take from that is, yes, there’s still a consumer there that has an appetite to buy a firearm, but they’re willing to wait and so they can get the best possible deal,” Mr Debney said.

The FBI said it carried out 200,000 background checks on gun buyers on Black Friday this year, setting a new record for a single day.

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