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Actionable news in SWHC: Smith & Wesson Holding Corporation,

Firearms stocks sell off as FBI background checks for gun purchases slow

Shares of firearms companies sold off Friday, after August data on national background checks for gun purchases showed a slowdown from the recent surge.

Shares of Smith & Wesson ended the day down about 6.4 percent, while rival Sturm Ruger was lost about 2.4 percent.

Yet some viewed the slide as an overreaction, as political debates proposing stricter gun controls should continue to drive short-term demand.

"We're reluctant to over read this data and think today's 7 percent selloff in [Smith & Wesson] is overdone, particularly since a potential Clinton presidential win could backstop gun demand," Cowen & Company analyst Cai von Rumohr said in a research note.

On an unadjusted basis, the FBI's National Instant Criminal Background Check System (NICS) data showed August checks totaled 1.85 million, a 6 percent increase year-over-year...