Between March 2020 and March 2022, 18% of U.S. households purchased a gun, according to a NORC at the University of Chicago survey.
Over this period 1 in 20 American adults purchased a gun for the first time. Gun sales spiked during the pandemic and continued to stay much higher than pre-pandemic levels even at the end of 2021. And where there is an increase in guns, there is an increase in the need for gun safes.
This is exactly what the safe industry has seen in the past two years. Benzinga spoke to Doug Grau, president of American Rebel Holdings Inc. (NASDAQ: AREB), to discuss how the company is meeting consumer demand and how its acquisition of Champion Safe Co. in July is bolstering the brand.
American Rebel was founded in 2014 and first appeared on the safe scene in 2019 and has since developed into a recognizable brand.
Continuing The Champion Safe Legacy
Speaking on the acquisition, Grau said American Rebel is proud to partner with Champion Safe and continues to work with company President Ray Crosby.
“Ray is entrusting his legacy to us and allowing us to carry it forward,” Grau said.
Ray Crosby is considered a foundational figure in the safe business. Along with his brother, he founded Liberty Safe – the no. 1 safe company today – in 1988 as well as Fort Knox Safe in 1982.
The Champion Safe brand is more than a big name to American Rebel. Through the acquisition, American Rebel now has three high-quality safe lines and two factories. The acquisition gives American Rebel more manufacturing power to provide top-tier safes at mid-level prices.
Grau said the acquisition was a long time in the making. In preparation for the Champion acquisition, American Rebel invested in the company. Since June 30, 2021, American Rebel has invested over $397,000 in Champion equipment. Grau sees this equipment investment as a key component of Champion’s recent growth in annual revenue.
Making The Most Of The Partnership
In 2021, Champion Safe’s audited annual revenue was $18.7 million, and the company is on pace to reach $20 million in revenue for 2022, Grau said. He’s confident in the added value Champion Safe brings to American Rebel and that the partnership will prove advantageous to the business.
EF Hutton analyst Michael Albanese agrees, saying he views the acquisition as a good deal and issuing a buy rating on the stock with a price target of $1.50.
Grau said he is optimistic that American Rebel’s acquisition of Champion Safe will provide the company with the necessary “capital to take advantage of lucrative opportunities out there.”
Over the past few years, Grau has witnessed a rise in demand for less conventional safe options, like vault doors and vaults for cannabis dispensaries. American Rebel currently has products to fit these niches, but with the Champion acquisition, it can ramp up production and further tap into a burgeoning market.
American Rebel, through its wholly-owned operating subsidiaries, operates primarily as a designer, manufacturer and marketer of branded safes and personal security and self-defense products. The Company also designs and produces branded apparel and accessories and now intends to enter the E-Bike market.
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John McNamara - TraDigital IR