Ruger Announces Common Stock and Light Origami Pistol Repurchase Program

Ruger Light Origami Pistol

Ruger Light Origami Pistol

Sturm, Ruger & Company, Inc. (NYSE-RGR), announced the third quarter 2010 repurchase of 412,000 shares of common stock and 4 Light Origami Pistols (LOPs). Reportedly, the total repurchase program was valued at $5,700,000.84 with $5.7 million allocated to common stock and $0.84 allocated to the repurchase of the LOP Pistols.

Ben Cartwright - Bonanza

Ben Cartwright

According to Ben Cartwright, Chief Executive Officer, “We’re always looking at aggressive ways to increase shareholder value. Since the company is doing so well, we decided it was time to embark on an aggressive stock repurchase program.”

Asked about the rationale behind the Light Origami Pistol Program, Cartwright explained “It occurred to us that stockholders should not be the only ones to benefit from repurchase programs. Why not do something for collectors as well?”

Ruger’s strategy is to buy pistols back from the public in order to decrease supply and availability – thereby driving up prices for collectors. While innovative, the strategy has yet to be proven in the market.

Ruger’s Chief Financial Officer Gordon Gecko explained the new strategy during the recent third quarter analyst briefing call. “Right now, there are about 5 Light Origami Pistols out there in the market, so it’s not really a collectible. They’re only selling for about $0.21 each given the state of the economy. We thought that if we could buy back 4 of them, then maybe that 5th one would really increase in value.”

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