In this article, we explore the 8 Best Gun Stocks to Buy in 2026.
Defense and firearms manufacturers produce weapons systems, ammunition, and related equipment for military, law enforcement, and civilian markets. These companies can be large defense contractors developing integrated weapons platforms or small specialized manufacturers focused on small arms, rifles, and ammunition production.
The companies operate in a market that, according to IMARC Group, is in the midst of a sustained expansion. IMARC Group valued the global firearms market at $44.0 billion in 2025 and expects it to reach $72.1 billion by 2034. This translates to a compound annual growth rate of 5.64% over the forecast period, and the growth will cut across civilian, law enforcement, military, and private security channels, the analysis noted. In fact, the Stockholm International Peace Research Institute, or SIPRI, noted in a March 9 report that, globally, arms demand is surging at its fastest pace in more than a decade. The report detailed that the volume of major arms transferred between states rose 9.2% between 2016 and 2020 and between 2021 and 2025.
According to SIPRI, European nations were the world’s largest recipients of arms, especially in the 2021-2025 period. The region more than tripled its arms imports over that period, said SIPRI. Meanwhile, US arms exports climbed 27%, and the country now supplies 42% of all international arms transfers. No wonder a Bloomberg index of global defense companies surged 18% in 2026 through March 19. In comparison, the S&P 500 declined 3.2%. This happened as the US-led attack on Iran continues to drive governments to rearm, a trend that has added over $28 billion to the fortunes of major defense stakeholders in just three months.
There is an additional layer of support for the gun market, especially in the US, from the civilian market. An analysis of gun sales trends in the US indicates that about 42% of American households owned at least one firearm as of 2022. The analysis added that handgun sales have continued to outpace long guns in early 2026. At the same time, Mordor Intelligence valued the domestic small arms market at $10.75 billion so far in 2026, and forecast it to reach $13.41 billion by 2031. This growth will be driven by defense modernization programs, civilian demand for personal-protection firearms, and advances in modular and smart weapon platforms, noted Mordor.
Against this backdrop, this analysis identifies some gun stocks best positioned to benefit from these converging tailwinds.
Our Methodology
To compile our list of the 8 Best Gun Stocks to Buy in 2026, we scanned Insider Monkey’s database of 1041 hedge funds for Q4 2025 to identify gun and ammunition companies. We prioritized companies that operate as close to pure-play gun businesses as possible, and from this pool, we filtered for stocks with a positive analyst consensus upside potential as of March 21, 2026. The final list is ranked in ascending order based on upside potential.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).
Best Gun Stocks to Buy in 2026
8. Smith & Wesson Brands Inc. (NASDAQ:SWBI)
Stock Upside: 5.71%
Number of Hedge Fund Holders: 16
Smith & Wesson Brands Inc. (NASDAQ:SWBI) is one of the best gun stocks to buy in 2026. On March 5, Smith & Wesson Brands Inc. (NASDAQ:SWBI) shared its third-quarter FY2026 financial results, in which revenue reached $135.7 million. This was a 17.1% increase year over year and surpassed the consensus estimate of $112.8 million. CEO Mark Smith explained during the earnings call that the revenue growth came from a 28% surge in handgun shipments into the sporting goods channel and stronger average selling prices.
Quarterly adjusted earnings per share, or EPS, came in at $0.08 compared to $0.03 a year ago. It was also double the $0.04 that Wall Street was expecting. According to management, the EPS improvement stemmed from an expanded gross margin of 26.2%, up 210 basis points, due to higher production volume, lower promotion costs and lower Federal Excise Tax. This was partially offset by tariff impacts.
Management also detailed that operating cash flow improved significantly to $20.5 million, a $30.3 million year over year swing. This was primarily due to lower inventory, which decreased $7.9 million during the quarter versus a $2.9 million increase in Q3 FY2025, the company noted in the earnings release. The company also reduced its debt to $75 million by quarter-end and subsequently repaid an additional $20 million on its line of credit. So, the outstanding borrowing at the end of the quarter was down to $55 million, Smith, the CEO, said during the earnings call.
For Q4 FY2026, management guided net sales to increase 10%-12% over Q4 FY2025. They cited continued market share growth, strength of brand and product assortment. Management also expects new product offerings to drive growth in an otherwise stable market.
Smith & Wesson Brands Inc. (NASDAQ:SWBI) designs, manufactures, and sells firearms for consumer, law enforcement, and military markets. Its product portfolio includes handguns, rifles, and related accessories distributed through sporting goods stores, firearm dealers, and online channels.
7. Northrop Grumman Corporation (NYSE:NOC)
Stock Upside: 6.07%
Number of Hedge Fund Holders: 62
Northrop Grumman Corporation (NYSE:NOC) is one of the best gun stocks to buy in 2026. On March 19, Northrop Grumman Corporation (NYSE:NOC) announced that its Talon IQ testbed completed its first-ever partner mission autonomy flight over Mojave, California. Talon IQ is a Model 437 aircraft built by Northrop’s Scaled Composites subsidiary. In this maiden autonomy flight, Talon IQ leveraged Shield AI’s Hivemind software, which served as the aircraft’s autonomous pilot.
According to the press release, Hivemind went through just a single day of hardware-in-the-loop validation before it was cleared for the actual flight. This speed, said Northrop, demonstrates how quickly third-party autonomy software can be onboarded to the Talon IQ platform.
Once airborne, Hivemind took full control of the aircraft. It directed the aircraft through combat air patrol and target engagement maneuvers in real time before the aircraft seamlessly handed control back to Northrop’s own Prism autonomy software. This validates that the two systems can operate interchangeably on the same platform, noted Northrop.
According to Northrop, Talon IQ is built around an open, plug-and-play design. This allows third-party autonomy systems to be swapped in with minimal friction, all while meeting US Government Reference Architecture standards. Put simply, developers don’t have to build a dedicated test aircraft every time they want to trial new software.
On March 17, Northrop Grumman underscored its role as a gun stock by accelerating delivery of the U.S. Army’s Integrated Battle Command System. This weapons integration program links sensors and interceptors into a unified fire control network, enabling faster targeting and engagement of missiles and aircraft. Backed by more than 120 U.S. suppliers and advanced manufacturing facilities, Northrop Grumman is producing thousands of components for rapid deployment, with full‑rate production already underway.
Northrop Grumman Corporation (NYSE:NOC) is a US defense contractor that develops and manufactures systems for the aerospace, defense, and national security sectors. Through its subsidiaries, the company produces military gun systems, including automatic cannons and naval guns integrated into aircraft, ships, and armored vehicles.
