Axon Enterprise is Friday's IBD Stock Of The Day as the maker of the Taser, body cameras and cloud-based evidence systems for law enforcement targets a new customer segment: retail workers. Axon stock moved past an early entry point on a bounce off key support.
Body Cameras For Retail Workers
On Jan. 25, the Scottsdale, Ariz., company announced the availability of Axon Body Workforce, an adapted version of the body camera used by law enforcement that's designed for front line retail and health care workers.
Axon said trials involving large health care networks and global retailers have demonstrated "early success in deterrence and de-escalation." One retailer saw 53% fewer incidents, Axon said. Another reported that 47% of active incidents were "effectively de-escalated after activating recordings on the camera."
Axon then announced the Feb. 1 acquisition of Fusus as a catalyst for its growing retail and health care presence. Axon didn't disclose terms.
Buying Fusus, which excels in aggregating live video, data and sensor feeds, provides Axon with new technology enabling seamless connections to video feeds from both fixed and body-worn cameras during unfolding incidents. That will bolster Axon's ability to equip law enforcement with real-time situational awareness via livestreaming. The goal is to facilitate rapid decision-making to deter or respond to escalating situations.
Axon's Growing Market Opportunity
Axon's move to provide a partial solution to the growing problem of retail theft is a continuation of the Taser innovator's steady expansion of its roles and market opportunity. In its Q3 earnings release on Nov. 7, Axon noted that 2023 was a breakout year for its business supplying federal government agencies and the U.S. Army. Five of its top 10 deals in Q3 were with federal government customers.
Axon sees a total addressable market of $50 billion, including $10 billion in potential annual revenue from the federal government.
Axon's Q4 earnings are expected at the end of February. In Q3, Axon reported its third straight quarter of 31% to 34% sales growth. Axon has said that its Taser 10, unveiled last January, has seen stronger-than-expected demand, though the ramp-up of manufacturing dealt a temporary setback to margins.
Axon Stock
In Friday's stock market action, Axon stock rose 1.6% to 256.66. That continued Thursday's rebound from Axon's 50-day moving average. The bounce above key support cleared a 255.74 early entry point.
For Axon, that was the first test of its 50-day line since it left behind a 217.61 cup-with-handle buy point in early November.
Axon also has a quasi-official buy point at 260.69, though the recent consolidation is a bit messy.
IBD Live discussed Axon Enterprise's stock chart in depth on Friday with special guest Leif Soreide.
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