Axon Enterprise, Inc. (AXON) is a publicly traded tech company headquartered in Scottsdale, Arizona. The company develops, manufactures, and markets technologies for public safety, including body-worn cameras, evidence management systems, and cloud-based platforms. Axon Enterprise is the parent company of two operating subsidiaries; Axon, Inc. and Axon Technology Solutions, Inc.
In recent years, Axon Enterprise has grown rapidly as an industry leader in providing innovative solutions to public safety organizations. The company’s products are being used in more than 18,000 law enforcement agencies across the United States and in more than 130 countries around the world.
Axon Enterprises: A Golden Opportunity?
Axon Enterprises is a data-driven technology company that focuses on providing public safety and governmental services. It’s highly recognized for its work in developing body-worn cameras for law enforcement and its intelligent network of camera systems and tools. Axon’s products are gaining traction in the market and the company is becoming well-known for providing citizens and police officers with improved safety and security. As a result, Axon’s stock has been on a steady rise over the past few years and looks to be set to continue.
This stock is not without risks, however. Axon relies heavily on government contracts, and with the current administration, government contracts are not a guarantee. It’s also worth noting that the stock is currently trading at a price point that’s on the high side.
Despite its risks, Axon Enterprises could still be a viable option for investors. Its technology is becoming increasingly important and needed, and its stock price is still relatively low when compared to other similar stocks. Furthermore, the company has a strong presence in the industry and continues to grow year after year.
Technical Analysis
Axon Enterprise has been in a strong uptrend since the beginning of 2021, with shares rising from a low of $61.11 on January 4, 2021, to a high of $236.45 on March 30, 2021. The stock pulled back with markets in 2022 and fell all the way down to $82.49. Axon went on to form a double bottomThe double bottom chart pattern is a reversal pattern that indicates the exhaustion of a downward trend and the potential for an upward trend. in May and June of 2022. The stock has exploded higher so far in 2023, up more than 128% from its $83 double bottom area.
On February 7, 2023, the stock formed a flush pattern as buyers stepped in to buy the stock after sellers dumped. This has formed a bullish long lower shadow hammer candlestick pattern.
The relative strength index (RSI) of 53 indicates that the stock is not overbought or oversold, suggesting that the uptrend could continue.
Fundamental Analysis
Axon Enterprise’s financials are strong, with revenueThe income statement provides a summary of a company's revenue and expenses over a specified period of time, typically a year or a quarter. It shows the company's total revenue, th... increasing from $452.9 million in 2018 to over $1 billion in 2022, an increase of more than 140%! The company’s net income also increased from $43.9 million in 2018 to $104.5 million in 2022, again a shocking increase of over 140%! Furthermore, the company’s balance sheetThe balance sheet is a snapshot of a company's financial position at a specific point in time. It shows the company's assets, liabilities, and equity. is strong, with a current ratio of 2.8 and a sizzling debt to equity ratio of ZERO! Wow!
Axon price target raised at JMP Securities
On February 1, 2023, JMP Securities analyst Erik Suppiger maintained an Outperform rating on the stock while increasing the price target for Axon to $235 from $195. According to the analyst’s research note to investors, spending on law enforcement technologies has remained relatively resilient to economic slowdown because it benefits from a supportive funding environment, an increasing demand for productivity tools due to a shortage of law enforcement personnel, and a growing awareness of gun violence. Axon is the company’s top pick for the Q4 earnings season.
Axon price target raised at Needham
Joshua Reilly, a Needham analyst, maintained a Buy rating on the shares of Axon and increased the price target from $200 to $240 on January 25, 2023. The analyst highlights the company’s recent release of TASER 10, which is anticipated to be widely adopted by law enforcement worldwide because it significantly improves upon TASER 7 in terms of features and functionality. Following the Q4 earnings call, which is anticipated in mid-February, more information on pricing and the launch date will probably be provided, says Needham.
Final Thoughts
Axon Enterprise is a strong and growing company with a solid financial position and a rapidly expanding customer base. The stock is in a strong uptrend and the technical and fundamental indicators both suggest that the stock could continue to move higher in the short-term. For these reasons, Axon Enterprise looks like a good buy for investors looking for a long-term investment.
