The sole-source contract Axon Enterprise (AXON 0.28%) just scored from the federal Drug Enforcement Administration (DEA) has a Morgan Stanley analyst saying it could open up a world of opportunity for the maker of Tasers, body cameras, and cloud-based evidence management tools.

James Faucette upgraded Axon stock to overweight from equal weight and hiked his target price 60% to $185 per share, a 23% premium to where the company's shares currently trade.

Police officers putting on body cameras

Police officers putting on body cameras. Image source: Axon Enterprise.

The DEA recently said there was no other provider of body cams for its agents that also offered direct-streaming access to Axon's database system. As a result, it was the only company being considered for a contract that could be valued between $10,000 and $250,000.

Faucette says that contract, and a similar one signed with the Bureau of Alcohol, Tobacco, Firearms and Explosives, mean there was a substantial probability Axon would see far greater penetration into "many new market opportunities," and at a faster rate.

He foresaw Axon entering into new markets such as corrections and broader areas of public-safety software that thus far have not registered very highly in its business.

The analyst says Axon is the single most capable company for delivering next-generation software while also being the leading supplier of less-than-lethal conductive energy weapons (CEW) and body cameras.

Axon separately announced that the Los Angeles Police Department has renewed their five-year contract, and purchased 5,260 Taser 7 CEWs and 355 Axon body cameras, bringing the total that the law enforcement agency deploys to 7,530 of the Tasers and 7,355 body cameras.