Axon Enterprise, Inc. (AXON) on Q1 2021 Results - Earnings Call Transcript
Andrea James: Hello everyone, and welcome to our First Quarter 2021 Earnings Conference Webinar. I’m Andrea James, Senior Vice President of Corporate Strategy and Investor Relations. Today, we have with us CEO, Rick Smith; President, Luke Larson; CFO, Jawad Ahsan; Chief Revenue Officer, Josh Isner; and Chief Product Officer, Jeff Kunins. I hope you’ve all had a chance to read our very robust shareholder letter, which we released after the market closed. You can find it at investor.axon.com. Our remarks today are meant to build upon the information in that robust letter. At the end of this call, we’ll play our quarterly earnings video. That’s our first time doing it on the earnings call, and you’re welcome to stay for that. If for some reason, we lose connectivity, we’ll endeavor to post a copy of our prepared remarks to investor.axon.com. Rick Smith: Thanks, Andrea, and hello, everyone. As you can see from the shareholder letter, we’ve had an exceptional start to the year. Our teams have remained heads down, executing on our mission and driving growth across all of our products and markets. I couldn’t be more proud of what we’ve built of Axon’s position as a true change agent and ultimately and most exciting, where we’re heading. We’ve always been passionate about innovation, and the inherent drive continues to propel our business forward. Today, I’d like to address current events, public and personal that are relevant to our business. First, recent current events, including last year’s death of George Floyd and the events that followed, forced our nation to reflect upon the values we hold true for all Americans. Axon is and will remain committed to creating technologies that save lives, increase transparency and help communities and public safety agencies who serve them, achieve a higher quality of life to ensure everyone makes it home safe. Customers and increasingly communities, see us as a key thought leader and key partner in the global drive to transform public safety. We hear stories daily about customers using our products to save lives and protect their communities. And we believe our problem-solving approach to these major challenges will continue to drive our growth. Two years ago when I published my book, The End of Killing, it was a radical idea that we can actually make the bullet obsolete and create less lethal weapons that could become the primary use of force and eventually displace lethal weapons. Customers were far more receptive to this idea than I could have anticipated. And in light of the events of the past 12 months, we are here pleased from our public safety customers and the broader community that they cannot wait until the deadline I had set at the end of this decade for us to achieve the goal of surpassing the sidearm and effectiveness. Luke Larson: Thanks, Rick. As stated in our shareholder letter, which we’ve got a ton of positive feedback on, shout out to our IR team, our teams are executing on our 2021 strategic priorities to grow our core, scale new products, unlock new markets and drive efficiency to fuel growth. We believe Axon has been at the forefront of change. But the past year, we’ve been put in the center of truly unprecedented events that inspired our teams to show up in many new ways. Our body cameras are capturing the most critical events in the world. We’re proud of that. And it’s a responsibility we take very seriously. During the civil unrest in the Capitol on January 6, for instance, DC Metropolitan Police and the Montgomery County Police who are Axon Body customers were called in for backup and the Justice Department has released Axon Body camera videos related to that incident. Axon Body cameras are also providing critical evidence in many of the current events that we’re all familiar with. Jawad Ahsan: Thanks, Luke. As our teams continue to execute at an extremely high level, we’re able to confidently invest in our future. Our strong balance sheet also gives us the flexibility to drive growth broadly across products, markets and geographies. We’ve recently made three strategic investments in Flock Safety, RapidSOS and Cellebrite, as well as expanded our strategic partnerships. These were carefully crafted moves that allow us to extend our platform as we aim to build the public safety ecosystem of the future. In Q1, we invested $20 million in RapidSOS and more recently completed a strategic partnership. When people dial 911, lives are literally in the balance when the call center doesn’t know where they are. RapidSOS is a leader in solving this problem. For example, if you call 911 today, using your iPhone, in the vast majority of U.S. jurisdictions, Apple will send your location to public safety via RapidSOS. Now, the location and live streams of Axon Body cameras and Axon Fleet cameras can be integrated into the RapidSOS platform, and RapidSOS data can be integrated into our new Axon Respond dispatching platform. Another recent investment in strategic partnership includes a $90 million participation in a PIPE transaction in connection with Cellebrite going public by a SPAC IPO. Cellebrite is the market leader in digital intelligence. Their software complements our lead in digital evidence management, and they share our strong emphasis on safeguards to protect privacy. We are consistently hearing great feedback from our customers in common with Cellebrite, and the company has been delivering compelling results. This partnership will make Evidence.com even more valuable for our customers. From an M&A perspective, as you can see, we’re taking a deliberate approach to how we partner and deploy our capital. You can expect to see us continue to be opportunistic and make strategic moves that strengthen and extend our platform. To be clear, we will be highly selective. Our continued strong execution allows us to make these types of investments and keep our strategic focus on investing for growth. However, it’s really the fact that we always lead with our mission to protect life, truce in the communities we serve that has us taking a long-term view on our business. As we work towards goals such as obsoleting the bullet, we are measuring our progress over a longer term horizon. In fact, we’d like to invite you to think about our business the way that we do in terms of years and not quarters. This is why today, we are introducing two-year revenue guidance for both, 2021 and 2022. For 2021, we are raising our revenue guidance by $40 million at the midpoint to $800 million. In 2022, our early view of the year anticipates that we will deliver approximately $920 million in revenue. A - Andrea James: Thanks, Jawad and team. I just want to check with our moderators that we can bring everybody up into the gallery view. And given me a nod when we are up in gallery view. Okay. We are up in gallery review. And analysts, we’ve got you all in our queue. So, no need to use the hand raise feature. And just let us know if you have a follow-up. We’ll take our first question from Keith Housum at Northcoast. Rick Smith: Keith Housum: All right. How are we doing now? All right. Thanks guys. Congratulations on a great quarter, and I appreciate the guidance going forward. Rick, it looks like now two quarters in a row, fantastic TASER sales with growth. Perhaps you can provide a little bit more color on what you think some of the drivers are. How are you guys achieving this TASER growth the past few quarters? And I guess, previous quarter type of growth? Rick Smith: Yes. I’ll touch on it. And then, Josh, I’ll hand it off to you. I would say, there’s really a shifting focus. 10 years ago, the focus with TASER, there was a lot of focus on sort of the medical safety of the devices. I think, we’ve come out of that, where now there’s really an intense focus on effectiveness. And in my book, where I talked about, I’m very transparent. We are not yet reliable enough to be a substitute for lethal force, but we’re heading that direction. We made a big step with TASER 7, and we’ll make an even bigger step on our next launch. And I think our customers are pretty excited, and we’re just seeing a lot of TASER 7 adoption that has really kind of picked up. We’re also seeing, I think, broader international adoption. There’s -- we’re getting -- I see orders coming in our daily reports, and I got to go look at the map to see where some of these countries are that a few years ago, weren’t even on our radar, and now we’re getting much broader coverage. And with that, Josh, let me hand over to you. Josh Isner: Yes. Thank you, Rick. Ultimately, I think it’s just a continued story of a lot of investments in the channel that we’ve made over the years are starting to pay off. As Jawad said, we’re diversifying, state and local law enforcement is absolutely a big part of that growth story, but so is international, so is federal, so is corrections. And so, we’ve got a lot of talented people doing a lot of great work right now. And we’ll continue to invest in white space in the channel to make sure those results continue to grow in the out years. Keith Housum: Okay, great. And then, just if I could, my follow-up, I’ve got a guy ask a question about the supply chain issues that’s happening really across all technologies these days. I guess, where in your portfolio of products, I guess, do you have any pinch points with supply chain? And are the issues getting worse here as we’re going into the second quarter? Jeff Kunins: Yes. Great question, Keith. I’ll fill that. So, our supply chain and ops team is led by a phenomenal guy, named Josh Goldman. And over the last year, we’ve really put buffers in place to ensure that we can meet the quarterly demand, as well as forecast out critical components. And I’ve just got to give the team a lot of credit to have navigated the last 12 months, and we’re keeping that same strategy looking forward. And as of today, we feel really good about it. Andrea James: Thanks, Keith. We’ll take our next question from Will Power at Baird. Will Power: Great, okay. Thanks for taking the question. Rick, first, sorry for your loss. Rick Smith: Thanks, Will. On the positive side, I hope to die the way he did. It was actually as positive and uplifting as such a thing could be. Will Power: Okay. That’s good. Well, congratulations on the results. Obviously, really strong across the board. I guess, maybe broadly looking at the opportunities in the U.S. in the spending habits. What are you seeing in terms of municipal budgets, any headwinds on that front? And to what degree are some of the federal aid plans helping? Rick Smith: Josh? Josh Isner: Absolutely. So, I think, about this time last year, there were a lot of questions about how that would materialize, and we’re still very happy to say it really hasn’t in a meaningful way. And in fact, a lot of the federal conveyed packages have provided additional funding to state and local. At first, it was mainly the large cities, but in the latest grant package, it was for small and midsized cities as well. So, we don’t see any kind of systematic challenges across municipal funding that make it any more or less worried some than in the past. We think it’s in front of us, and we provide the right products that our customers value. We really believe that they’ll be able to find funding to buy them. Will Power: Okay. That’s great. And if I could sneak in just one. Really nice to see some of the early Fleet 3 indicators. I’m wondering if you could just provide any more color as to what’s kind of helping set you apart in the market? Any issues potentially on the supply side in terms of meeting that demand? Just any more background there would be great. Rick Smith: I’m sorry, what was it? I couldn’t hear what product are you referring to, Will? Jeff Kunins: Fleet. Josh Isner: Fleet. Why don’t I take the first stab and then pass it to Jeff. So, one thing that I talked about that we’re really excited about is just the attach rate to the ALPR. And this is one where I think the customers are saying, hey, I can go with one solution with Axon and get these two critical benefits. It also is a great story around how we’re able to provide not only the hardware but also the software and advanced software that the customers are willing to pay for it. Go ahead, Jeff. Jeff Kunins: Yes. Just continuing on that. First and foremost, on the camera system itself, we’re really proud and looking forward to shipping it to customers that is overwhelmingly our best camera system ever for the car. And we’ve -- just on those merits alone, that drives a lot of the demand that we’re seeing. And then, as we’ve alluded to, one of the things that is Axon’s greatest strength is how we combine these devices with the power of intelligent cloud services. And so, both, with our Respond live streaming connected and as well as our Vievu disruptively affordable and ethically designed from the ground up approach to ALPR really creates, for the first time, the ability for an agency to afford for the same budgets they’re used to spending to put ALPR capability in every single vehicle. And so, you put all that together at an attractive overall price. And again, we still have -- we look forward to shipping it later this year and seeing how customers love it. Rick Smith: I’ve got to add one more thing. And maybe we’re too transparent sometimes. But with Fleet 1 and 2, we’re scrapping, we have to get to market fast. The hardware was not our strength in those products. And we still got to, I think, the top end of the suppliers in the market. Fleet 3, now we’re bringing our a game. This is the first camera where the hardware has been designed from the ground up for this use case. Previously, we did take our body cameras and then refactor them to the car. And we learned a ton by doing that. But, I’m really pumped to see what’s going to happen because what we’re bringing on now has been purpose-built over a multiyear period by some really talented and awesome folks. So, I’m excited to see how it performs in the market. Andrea James: All right. Thanks. Well, we love the families here at Axon. We’ll take our next question from Jonathan Ho at William Blair. Go ahead, Jonathan. Jonathan Ho: I wanted to just start out with the two-year guidance. Just given the lumpiness that you’re seeing in some of these international deals and the longer sales cycles, I guess, can you talk a little bit about how you’re building that long run above forecast? And what maybe gives you the confidence to be able to offer a two-year view this early? Jawad Ahsan: Yes. I’d like to start with that, and would love to hear Josh’s input as well. So, there are a couple of factors, Jonathan. The first one is, look, quite frankly, the business is rocking and rolling. We’ve got -- you’ve heard us allude to it. We’ve collected a pretty fantastic collection of talent in all of our functions, and they are executing crisply and reliably. And I have a tremendous amount of confidence in them. The pipeline that we’ve built, I feel like we’ve got a very high likelihood that we’re going to execute on that to such a degree that I feel confident going out two years on our guidance. The second factor is -- and we’ve also alluded to this, is that these international deals, it makes it difficult for us to give quarter-to-quarter guidance. It’s better for us to think in terms of years. Because they’re larger, they’re more complex, there’s so many more factors involved, financial, operational, regulatory, political. And really, we think about the business in terms of years. And what we’re working towards is to build a business that will sustainably grow at a 20%-plus CAGR year-over-year. Josh Isner: And then, lastly, I would just add, one of the benefits of really focusing on bookings as a forward-looking indicator of our results. Our bookings continue to grow year in and year out. And we saw that last year. We’re seeing it this year as well. And we’re very excited about what that means for the future. So, we certainly do between bringing on more and more enterprise sales talent that gets better and better at forecasting, combining that with having growing bookings year-over-year, it gives us a lot of confidence that we’re going to keep growing. Jonathan Ho: Got it. Can you also maybe give us a little bit more color in terms of the traction that you’re seeing relative to the RMS and CAD solutions, specifically your software suite? And maybe how that’s sort of contributing to net retention and some of the expansionary metrics there as well? Thank you. Josh Isner: Certainly. We’re really excited. We’re seeing customers that have had a lot of confidence in us historically willing to partner with us more on our newer offerings. When we go into police departments, one of the questions we always ask is, what’s the best piece of functioning software you deploy today? And oftentimes we hear it’s Evidence.com. And that inspires a lot of confidence from our customers that the next piece of enterprise software we deliver is going to be equally good or better. And so, right now, we have to be very careful in terms of making sure that we set the right expectations. We bring on the right customers for us early on, and we make those customers really successful. And that’s what we’re focused on right now. And we believe just like we have in every category that we’ve entered, we turn those early evangelists into a growing market over the years to come, and we have a lot of confidence we’re going to do that in our records and dispatch as well. Andrea James: Thanks, Jonathan. We’ll take our next question from Jeremy Hamblin at Craig-Hallum. Go ahead, Jeremy. Jeremy Hamblin: Thanks. And congratulations on the strong results, and also as well my thoughts on your family. I wanted to actually ask about Cellebrite. And thinking about the investments that you’ve made in that business, what is the likelihood that with the rapid growth that they’re seeing that you’re going to have additional investments made in that business down the road? How much more integrated can you potentially see these businesses becoming? Jawad Ahsan: Yes. I’ll start. So, Cellebrite is a company that we’ve been admiring from a far for some time now. We had a chance to build a relationship with them prior to the SPAC deal coming on our radar. It’s someone we really admired. As we talk about, they’re a leader in digital intelligence. We think it’s a very natural extension of our lead in digital evidence management. And this is a long-term play. We really view our partnership with them as strategically important to Axon. And we’ll evaluate the opportunity to invest more or something beyond that going forward. But, at this point, we feel really good about where we’re at. Luke Larson: I think, I would just add to that. Just as Jawad talked about earlier, you can see that pattern in all of these very judicious investments we’ve made so far. So, between Flock Safety and then RapidSOS and then now with Cellebrite, all of them are -- yes, they’re a financial investments, but they’re very purposefully chosen to be a match for places where customers win as we do interesting things together commercially as well. And the investment is an accelerant to what we would otherwise want to naturally do as great partners. Jeremy Hamblin: Great. And then, I also wanted to just ask about your annual recurring revenue, you’ve had very steady pace on this. It’s roughly $20 million a quarter that you’re adding on. As the Company gets bigger and bigger, what would potentially drive deviation to the upside from that $20 million a quarter? Is it just perhaps just gaining significant traction in RMS? Is that going to be the big driver? But, how do we potentially step up from that level from here? Jawad Ahsan: Yes. So, one of the things that Josh alluded to is for us, the leading indicator is really bookings. And we’re right now, just like we’ve made investments in new international markets, we’re also making investments in these new product categories, like records and dispatch. And we’re in the very early innings. We’re building a product that we’re very proud of. And we think it’s going to be a market leader. And so, the leading indicator for us is going to be bookings. As those bookings come in, we think that will just continue to add that will end up translating into ARR. Andrea James: Jeremy, I just wanted to piggyback, just real quick just to make sure your numbers on that one. We’re very proud of the rate that we’re adding ARR, but it’s been -- the average over the last year has been closer to $15 million a quarter. And that’s what Jawad, the number he referenced in his script as well. We’ll take our next question from John Godin at Needham. Go ahead, John. Unidentified Analyst: Hey, guys. I appreciate you taking my questions. Congrats on the nice quarter. I have a question around the VR products. Obviously, given a lot of the social unrest, how have you seen demand trends early on for that? And thinking from a high level, given looking out two or three years, how do you see that product kind of growing and coming to market? And then, maybe also where you think that you fit in competitively? Thanks. Jawad Ahsan: Yes. Why don’t I start with that and then have Josh follow-up. So, the demand that we’ve seen for VR, I would say, is nearly unprecedented, where customers are coming to us. We’re explaining what our existing offering is with community agent scenarios, some of the future ideas that we’re developing. And we’ve seen a really, really healthy pipeline from all sized agencies, a lot of geographical distribution. So, we feel like this is one where there’s a lot of demand. Josh Isner: Yes. I think that’s right. I just want to be clear though. I’m very cautious to attribute that to really anything except we’re addressing a need that has existed for the last 20 years, it will exist in the next 20 years. And there aren’t -- we can’t control kind of year-to-year what the narrative is in the public or what’s going on externally. So, for us, it’s about building products that we think better and make our customers more effective and safer at their jobs, make communities safer. And we think VR is of that category. And we’re super excited about this one. We see a lot of demand in the market. We see a lot of alignment with our mission long term. And this is one that -- it’s a new category that we’re really proud to be participating in. And we’ve got a team that’s very focused and excited about scaling it over the next several years. Andrea James: We’ll take our next question from Erik Lapinski at Morgan Stanley. Go ahead, Erik. Erik Lapinski: Maybe going back to the Baltimore rollout of records. And just wondering as you’re working through that, like what’s the level of customization that a larger police department would be pushing forward with that? Like, is the product modular enough that you can kind of work around what they might want? I guess, just wondering like how that process goes and if it has altered the development path in any way from making it more customizable? Rick Smith: Sure. No, great question. Inherently, not only for us but for everyone playing in any of these large complex enterprise software plays inside and outside of public safety, there is that advance. And I think for us, it was clear as we continue to go forward that we are really excited about that we’re building the right pieces in the right order, as we keep building up the product and winning and working to delight our early customers. And as Josh said earlier today and as you’ve heard me say on the last couple of calls, this is a multiyear journey for us, and we are determined in our path to ultimately become number one in these categories, but we also have evolutions it takes time. And it’s one piece of our overall path of our sensors and software contributing more and more the full portfolio of scenarios that our customers need to be successful every day. So, we feel great about that rollout and about what -- what Baltimore’s needs, and each of our early customers’ needs are, apply all of the additional customers as we keep going. Andrea James: And we just got some feedback from the outside that Erik’s question and John’s maybe not that well heard. So, John Godin had asked about virtual reality, training. And Erik had asked about the level of customization required for Baltimore PD. Erik Lapinski: If I can ask 1 more, too, just on international traction in bookings there. Is that primarily TASER right now, or are you also seeing it picking up with the body cam side? I think, the last time we’ve asked on that, it was kind of TASER was really leading some of the international expansion, but wondering if body cam has followed? Andrea James: And the question is about what products -- just real quick, Josh. The question is about what products are driving our international bookings. Thanks, Josh. Go ahead. Josh Isner: Yes. Sorry about that. Absolutely. I think it’s a great question. The good news is, we’re seeing both. It depends on the market. Some markets, we lead with TASER. And then, we grow those into body cam customers in other markets and customers were leading with body cams and even without body cameras, which is a growing segment for us in international, where large customers, and we expect to see a couple of these in the next couple of quarters, buy software-only packages from us in high volumes. So we’re particularly excited about that new trend that we’re seeing. And so, we feel like we’re really, really well positioned, just like in the United States, where we started with one product and have diversified and grown customers into adopting several of our products. We’re seeing that same thing starting to happen in international. Andrea James: Thanks, Erik. Do any of our analysts have any follow-up questions? No? Okay. Well, thanks, guys, so much for joining us. We’re going to have Rick close us out. Rick Smith: Thanks, Andrea. Hey, before you leave, if you have time to stick around, we’re going to play our quarterly earnings video. So, thanks for joining. We look forward to updating you throughout the year. We’ll drop off after this video. And the webcast will be posted to investor.axon.com. Roll video.
Axon Enterprise (NASDAQ:AXON) Maintains "Hold" Rating Amid Market Volatility
- Barclays maintains a "Hold" rating for Axon Enterprise (NASDAQ:AXON), with the stock currently priced at $515.45.
- The company's transition to a subscription model enhances revenue predictability despite being considered overvalued in the short term.
- Axon faces challenges such as significant market volatility, antitrust risks, and competition, notably from Motorola.
Axon Enterprise, listed on the NASDAQ as AXON, is a key player in the law enforcement technology sector. The company is known for its comprehensive product ecosystem, which includes hardware, software, and cloud services. Axon has made significant strides in wearable cameras and cloud-based evidence management, positioning itself as a leader in the industry. However, it faces competition from companies like Motorola.
On March 10, 2025, Barclays maintained its "Hold" rating for AXON, with the stock priced at $515.45. This decision comes amid significant interest from smart money in AXON options, as highlighted by Benzinga. Despite the stock's current price reflecting a 2.08% decrease, it remains a focal point for investors due to its robust business model and recurring revenue stream.
Axon's transition to a subscription model has enhanced revenue predictability, a crucial factor for investors. However, the company's shares are currently considered overvalued, which could impact its short-term growth. The stock has fluctuated between $501.85 and $521.81 today, with a market capitalization of approximately $39.5 billion, indicating its substantial presence in the market.
The company's stock has experienced significant volatility over the past year, reaching a high of $715.99 and a low of $273.52. This volatility, coupled with antitrust risks and competition from Motorola, presents challenges for Axon's growth. Despite these hurdles, the company's innovative approach and strong market position continue to attract investor interest.
With a trading volume of 1,357,959 shares, AXON remains an active player on the NASDAQ exchange. The company's focus on integrating hardware, software, and cloud services has been a key driver of its success. However, investors should remain cautious of potential antitrust issues and competitive pressures that could affect Axon's future performance.
Axon Enterprise, Inc. (NASDAQ:AXON) Earnings Preview: Strong Growth Expected
- Earnings per Share (EPS) and revenue growth are anticipated to be significant, with a 34.8% increase in EPS and a 31.3% increase in revenue year-over-year.
- The company's valuation metrics demonstrate high investor confidence, with a P/E ratio of approximately 130.23.
- Financial stability is indicated by a low debt-to-equity ratio of 0.34 and a strong current ratio of about 2.96.
Axon Enterprise, Inc. (NASDAQ:AXON) is a leading provider of public safety technology, known for its development of TASER devices and body cameras. The company is set to release its fourth-quarter 2024 earnings on February 25, 2025. Analysts are closely watching the earnings per share (EPS) and revenue figures, which are key indicators of the company's financial health.
Wall Street analysts estimate Axon's EPS to be $1.37, while the Zacks Consensus Estimate is slightly higher at $1.51. This represents a significant 34.8% increase from the previous year, highlighting the company's strong performance. Revenue projections also show growth, with estimates around $566.7 million to $567.6 million, marking a 31.3% year-over-year increase.
For the entire year of 2024, Axon's revenue is projected to reach $2.08 billion, a 32.8% increase from the previous year. The consensus estimate for annual EPS is $5.29, reflecting a 27.8% rise. Axon's consistent track record of exceeding earnings expectations may influence investor decisions, as highlighted by Zacks.
Axon's valuation metrics indicate a high level of investor confidence. The company's P/E ratio is approximately 130.23, suggesting investors are willing to pay over 130 times its earnings. The price-to-sales ratio is about 20.16, and the enterprise value to sales ratio is similar at 20.17, reflecting the company's strong market position.
The company's financial stability is further supported by a debt-to-equity ratio of 0.34, indicating low debt levels. Axon's current ratio of about 2.96 shows strong liquidity, ensuring it can cover short-term liabilities. These factors contribute to the company's robust financial health and investor appeal.
Axon Enterprise Target Raised to $645 Amid AI Momentum and Strong Software Growth
Raymond James analysts raised the price target for Axon Enterprise (NASDAQ:AXON) to $645 from $515, maintaining an Outperform rating on the stock. The revision reflects continued confidence in the company’s strong growth trajectory, driven by its strategic shift toward software and artificial intelligence, despite a recent pullback in the stock.
Axon shares have surged over 240% in the past two years and 130% in 2024, underscoring investor enthusiasm for the company’s transformation and innovative offerings. However, the stock recently dipped approximately 20%, likely due to profit-taking, valuation concerns, and elevated expectations for its fourth-quarter 2024 results and 2025 guidance. This decline, the analysts argue, presents a compelling entry point for investors.
Axon’s increasing emphasis on software and AI positions it well for continued growth. The analysts anticipate positive estimate revisions with the company’s upcoming earnings report, highlighting Axon’s accelerating cloud revenue. Raymond James’ revised model projects cloud-related revenue reaching $1.5 billion by 2026, a $103 million increase from previous estimates and approximately $200 million above consensus. Total sales are forecast to hit $3.16 billion, exceeding the Street’s projections by $72 million.
Axon Enterprise's Recent Stock Activity and Strategic Moves
- Kalinowski Caitlin Elizabeth, a director at Axon Enterprise, sold 450 shares at $604.07 each, leaving her with 6,929 shares.
- Axon's acquisition of Dedrone enhances its capabilities in airspace protection, indicating a strategic move into new markets.
- Despite a slight decline upon joining the Nasdaq 100 Index, Axon's stock shows signs of recovery with a current price increase of 0.37%.
On January 2, 2025, Kalinowski Caitlin Elizabeth, a director at NASDAQ:AXON, sold 450 shares of the company's common stock at $604.07 each. This transaction leaves her with 6,929 shares. Axon Enterprise, known for its TASERS, body cameras, and cloud services, is performing well in its core business areas, as highlighted by its recent strategic moves.
Axon recently acquired Dedrone, enhancing its capabilities in airspace protection against drones. This acquisition allows Axon to enter new markets, potentially increasing profitability. The company's focus on innovative technologies like artificial intelligence and augmented reality further strengthens its position in the public safety sector, as discussed by President Josh Isner in a podcast with Motley Fool.
Despite these advancements, Axon's stock faced a decline on its first day as a member of the Nasdaq 100 Index, alongside Palantir and MicroStrategy. This initial drop presents a challenge for the company in the prestigious index. However, the current stock price of $596.49 shows a slight increase of 0.37% or $2.17, indicating some recovery.
Axon's stock has fluctuated today between $588.20 and $612.25, with a market capitalization of approximately $45.49 billion. Over the past year, the stock has seen a high of $698.67 and a low of $241.72. The trading volume on the NASDAQ exchange is 516,451 shares, reflecting active investor interest in the company.
Axon Enterprise, Inc. (NASDAQ:AXON) Stock Analysis
- High Valuation Indicators: Axon's P/E ratio of 161.33 and price-to-sales ratio of 24.97 suggest a high market valuation and strong investor confidence in future growth.
- Strong Financial Health: A debt-to-equity ratio of 0.32 and current ratio of 2.96 indicate prudent debt management and solid liquidity.
- Executive Stock Sale: Despite a significant stock sale by Chief Product Officer Jeffrey C. Kunins, his continued substantial holding reflects ongoing investment in Axon's success.
Axon Enterprise, Inc. (NASDAQ:AXON) is a leading provider of public safety technology solutions, known for its development of TASER devices and body cameras. The company operates in a competitive landscape, with rivals like Motorola Solutions and Digital Ally. On December 17, 2024, Kunins Jeffrey C, Axon's Chief Product Officer and Chief Technology Officer, sold 470 shares of the company's common stock at approximately $635.24 each. Despite this sale, he still holds 126,850 shares, reflecting his continued investment in the company.
Wall Street analysts currently view Axon as a favorable investment opportunity. These analysts' recommendations can significantly influence stock prices, as investors often rely on their insights to make informed decisions. However, the impact of these recommendations is a topic of debate among investors, as highlighted by the media. Axon's high price-to-earnings (P/E) ratio of 161.33 suggests a high valuation relative to its earnings, indicating strong market confidence in its future growth prospects.
Axon's price-to-sales ratio of 24.97 and enterprise value to sales ratio of 24.99 suggest that investors are willing to pay a premium for the company's sales. This reflects the market's positive outlook on Axon's ability to generate revenue. Additionally, the enterprise value to operating cash flow ratio of 162.67 highlights a significant premium on its cash flow generation, indicating strong investor confidence in the company's financial health.
The company's earnings yield is relatively low at 0.62%, which is the inverse of the P/E ratio and indicates the return on investment for shareholders. Despite this low yield, Axon's conservative debt-to-equity ratio of 0.32 suggests a prudent approach to leveraging debt in its capital structure. This conservative use of debt, combined with a strong liquidity position indicated by a current ratio of 2.96, underscores Axon's ability to cover short-term liabilities with its short-term assets, ensuring financial stability.
Axon Enterprise, Inc. (NASDAQ:AXON) Financial Overview and Stock Sale by Director
- Matthew R. McBrady, a director at Axon, sold 121 shares at approximately $600.85 each, following a strong third-quarter earnings report.
- Axon's financial performance showcases record revenue and net income, with a focus on Taser devices, body cameras, and software solutions for law enforcement.
- Despite a high price-to-earnings (P/E) ratio of 154.74 and other valuation metrics, Axon's innovative AI tools and international opportunities support optimistic long-term growth prospects.
Axon Enterprise, Inc. (NASDAQ:AXON) is a leading provider of public safety technology, best known for its Taser devices and body cameras. The company also offers a range of software solutions for law enforcement agencies. Axon competes with companies like Motorola Solutions and Digital Ally in the public safety technology sector.
On November 20, 2024, Matthew R. McBrady, a director at Axon, sold 121 shares of the company's common stock at approximately $600.85 each. This transaction comes on the heels of Axon's strong third-quarter earnings report, which has driven the stock price to around $600 per share. McBrady now holds 4,771 shares of Axon.
Axon's recent financial performance is impressive, with record revenue and net income from its Taser business and software segment. The company's innovative AI tools and international opportunities are expected to support its long-term growth. Despite a high price-to-earnings (P/E) ratio of 154.74, investors remain optimistic about Axon's future.
The company's price-to-sales ratio of 23.95 and enterprise value to sales ratio of 23.97 reflect a high market valuation relative to its revenue. These metrics indicate that investors are willing to pay a premium for Axon's growth potential. The enterprise value to operating cash flow ratio of 156.04 further underscores the company's high valuation.
Axon's financial health is strong, with a debt-to-equity ratio of 0.34, indicating low debt levels compared to equity. The current ratio of 2.96 suggests that Axon can comfortably cover its short-term liabilities with its short-term assets. Despite an earnings yield of 0.65%, the company's growth prospects make it a hold for investors.
JMP Securities Upgrades AXON to Outperform with Increased Price Target
JMP Securities Upgrades AXON:Nasdaq to Outperform
JMP Securities recently upgraded AXON to Outperform, signaling a positive shift in their perspective towards Axon Enterprise's stock. This upgrade, as reported by TheFly, comes with an increased price target of $375, up from the previous $320. This adjustment is a clear indication of JMP Securities' confidence in AXON's potential for growth and their belief in the company's future financial performance. At the time of the announcement, AXON's stock price stood at $313.66, reflecting the market's anticipation and reaction to the company's prospects.
The upgrade by JMP Securities aligns with AXON's recent market performance, which has shown resilience and potential for growth. Despite a slight depreciation of 1.49% over the past month, AXON has outperformed the broader Industrial Products sector and the S&P 500, which saw losses of 2.63% and 2%, respectively. This performance is particularly noteworthy in a challenging market environment, highlighting AXON's strength and stability relative to its peers and the broader market.
Furthermore, AXON's recent trading activity and financial metrics provide additional context to JMP Securities' optimistic outlook. The company's stock has been trading between $309.20 and $314.78, with a peak price over the past year of $329.87. This trading range underscores the stock's volatility but also its potential for significant growth, as evidenced by its peak price. With a market capitalization of approximately $23.67 billion and a trading volume of 590,668 shares on the NASDAQ exchange, AXON demonstrates substantial market presence and investor interest.
The anticipation surrounding AXON's upcoming earnings report on May 6, 2024, further supports JMP Securities' positive stance. Analysts expect Axon Enterprise to report earnings of $0.97 per share, representing a year-over-year growth of 10.23%. Additionally, revenue predictions stand at approximately $437 million, suggesting strong financial performance and potential for continued growth. These expectations, if met or exceeded, could further validate JMP Securities' upgrade and reinforce confidence in AXON's market position and financial health.
Overall, JMP Securities' decision to upgrade AXON to Outperform, coupled with the company's recent market performance and upcoming financial expectations, paints a promising picture for Axon Enterprise. The increased price target and positive outlook reflect a belief in the company's growth potential, driven by its innovative products like stun guns and body cameras, and its ability to navigate market challenges. As AXON continues to perform and meet its financial targets, it remains a stock to watch for investors seeking growth opportunities in the technology and security sectors.
