2 weeks Ago By [email protected] (Jeremy Bowman)
Axon Enterprise ( AXON -2.16% ) is one of the best-performing stocks of the last 10 years, up roughly 2,000% during that time. The maker of the TASER electrical weapon and body cameras has delivered consistent growth and technological innovation.
A strong software business complement its hardware as well. However, if you're wondering if Axon's best days are behind it, it's not too late. The stock has pulled back substantially in the recent market sell-off, offering a discounted entry point.
Why Axon can keep growing Despite the phenomenal results Axon has delivered over the last decade, its growth days are far from over. The company continues to invest in new products, grow its software business, and tap into new customer bases. Management noted that its biggest contract in 2024 came from the private sector as it signed a deal to supply a logistics company with body cameras.
Axon is also doing exciting things on the technology front. It has developed its own generative AI technology and a product called Draft One, which makes initial drafts of police reports based on the footage from body and dashboard cameras, a technology that is reportedly very popular with law enforcement as a significant time saver. Management's guidance for 2025 also calls for continued growth with revenue rising 25% at the midpoint of the $2.
55 billion to $2.65 billion range. It also expects adjusted earnings before interest, taxes, depreciation, and amortization ( EBITDA ) of $640 million to $670 million, meaning the stock trades at 68 times the midpoint of its forward EBITDA estimates.
Is Axon a buy? The current economic climate presents some uncertainty for nearly every stock, but Axon should be more resistant to tariffs and economic pressure than most tech stocks since it sells primarily to the public sector, and it manufactures domestically. With the stock down 20% from its peak, it looks attractively priced, and the business should continue its impressive expansion..
