Peltier said investors will quickly notice the stock is up over 20% from the start of the year and will also notice the company's lofty 4.7% dividend yield, which is double that of the average company in the S&P 500 and 200 basis points higher than the 10-year Treasury yield.
With strong guns sales in 2013, Sturm, Ruger is expected to earn about $5 per share in earnings, enough to cover the current dividend payout two times over, Peltier said.
However, sales are expected to decline by 30% in 2014, which could potentially crimp any future dividend raises over that time. For this reason, Peltier suggests waiting for a pullback below $50 per share, a decline of roughly 10%.-- Written by Bret Kenwell in Petoskey, Mich. Follow @BretKenwell