Please ensure Javascript is enabled for purposes of website accessibility

Axon Enterprise Stock Has 25% Upside on Strong Taser Demand: Analyst

By Rich Duprey - Updated Feb 26, 2021 at 12:05PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Taser maker notched the largest contract win in the company's history In the fourth quarter.

Axon Enterprise (AXON -0.57%) is still seeing strong demand for its conducted electrical weapons (CEWs). The manufacturer of law enforcement protective equipment recorded a $20 million order in the fourth quarter by an international customer for its newest stun gun, the cloud-connected Taser 7, the largest order in the company's history.

Coupled with Axon raising its adjusted earnings guidance for the full year, that led Baird analyst William Power to hike his price target for the stock from $135 to $200. With the shares closing on Thursday at just under $160, it suggests he sees 25% upside for the stock.

Police officer wearing a Taser 7 and Axon Body 3 camera

A police officer with Axon's Taser 7 and Axon 3 body camera. Image source: Axon Enterprise.

Tasers still account for the bulk of Axon's revenue, generating $135.7 million in sales in the fourth quarter, up almost 62% year over year, or 60% of total revenue. The CEW has become a crucial tool for law enforcement, and Axon says it's been adopted by a majority of U.S. police departments.

Body camera sales also remain robust, though they were actually down 22% from last year. It launched its Axon Body 3 body cam, which, like the Taser 7, is cloud-connected, a key selling feature of its product ecosystem. Its CEWs, body cams, and record and digital evidence management are seamlessly interconnected. That will be important since Motorola Solutions (MSI -3.71%) just launched its own competing suite of connected cameras, digital evidence management, and cloud-based support. 

Axon raised its adjusted EBITDA guidance to a range of $125 million to $140 million from its previous range of $120 million to $130 million.

The Baird analyst told investors in a research note that he believes the new guidance is conservative, but that Axon has a strong competitive position in the market grounded by a record of growth.


Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Axon Enterprise Stock Quote
Axon Enterprise
$96.25 (-0.57%) $0.55
Motorola Solutions, Inc. Stock Quote
Motorola Solutions, Inc.
$205.47 (-3.71%) $-7.92

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/18/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.