Go ahead, take my bonus!

As bankers at Goldman Sachs arm themselves with handguns, it just might be one more reason to take a look at gun stocks.

By InvestorPlace Dec 1, 2009 2:17PM

Jamie DlugoschThis article is by InvestorPlace's Jamie Dlugosch.


If you believe a somewhat thin Bloomberg report out today, bankers at Goldman Sachs are arming themselves in preparation for a populist uprising against outrageous bonuses and bailouts.


That they'd be getting ready would hardly be a surprise, given the level of rage over compensation and taxpayer bailouts for the rich the news should not be a shock.


Of course, if any nut job does indeed decide to take matters to such an extreme, a handgun is unlikely to provide any real protection. It provides only an illusory peace of mind.


Something tells me, though, it might provide another reason to take a look at gun stocks. If brokers and bankers are arming themselves, they might very well chase the stocks, too.


Smith & Wesson and Four More Bargain Stocks to Buy Now


There have been many reports of gun sales picking up since President Obama was elected -- make of that what you will -- and bankers may just be the next group gearing up for the Apocalypse.


About the only good news in this is for those that profit from the arms race. That means owning gun stocks and sporting goods retailers that sell firearms.


Stocks like Smith & Wesson (SWHC) and Sturm Ruger (RGR) are very high on my list of top stocks to buy in 2010. On the retail side, a stock like sporting goods store Cabela's (CAB) also ranks very highly.


All three of these stocks are expected to grow earnings at a high rate next year and currently trade for valuations that are comparatively cheap despite rising sales.


Fueling that growth is a rising angst amongst both the rich and the poor. The poor are feeling emboldened to protect against government intrusions, and the rich are protecting against populist uprising.


I'm not sure society ends up better off as a result of these conflicting interests. I don't want to encourage it. But sometimes as an investor, you have to hold your nose and make some money.  


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