Ruger Q2 Backlog Worth $590 Million!
A contributor at Seeking Alpha reports that Ruger’s has an order backlog worth an incredible $590 million as of the end of the second quarter. This backlog is down only slightly from the Q1 backlog which was $602 million. In Q2 incoming orders were down from Q1 and Q4 (2012), but still far higher than Q2 in 2011 and 2012.
A major short term catalyst that I see for Sturm Ruger is its mounting level of backlog orders. Demand for guns has increased so dramatically that the company’s manufacturing facilities are struggling to keep up. Backlog is piling up so quickly that management opted to restrict some of the incoming orders during Q2 2013. As a seasonal company, most orders are received during Q1 and Q4 when gun shows occur in great numbers, meaning that the latest quarter was not even peak season. The following chart illustrates how high backlog has piled up when orders during peak quarters far exceeded production capacity. The difference between incoming orders (green bars) and production (blue line), determines how much backlog grows in a given quarter.
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This is a bummer, I put my hands on a SR9c the other day. I am seriously thinking about trading in my P89 for one when they become plentiful again.
I assume a lot of those orders will go unfilled. Panic buying, people ordering from multiple manufacturers, and canceling most of them as soon as they get a gun.
Still significant.