Axon Enterprise is Monday's IBD Stock Of The Day as the innovator of the Taser and cloud-based evidence management sees generative AI-related sales take off and its drone business gain momentum. After a four-week winning streak, Axon stock is hovering just below a buy point from a cup base.
As the overall market sees some volatility amid Trump tariffs and nerves over Magnificent Seven valuations, Axon looks relatively safe. While it stands to gain from tax cuts and isn't an obvious target for tariff retaliation, Axon's safety- and productivity-enhancing tech also may be seen as good investments if government budget cutting takes hold.
Axon's AI Era Bundle
Draft One, which Axon unveiled last April, can write the first draft of police reports in a second, using audio uploaded to the cloud from officers' body cameras. Draft One, which Axon says can save an hour in daily report writing per officer, has become its fastest-selling product.
Several other AI-powered solutions are expected to become available in 2025, William Blair analyst Jonathan Ho wrote in a Dec. 18 note, after hosting an investor presentation by Jeff Kunins, Axon's chief product officer and chief technology officer.
That includes Live Translation, which Axon says uses cloud-connected body cameras to enable real-time translation between two speakers in 100 languages, "removing language barriers, fostering relationships and enhancing transparency."
In a Nov. 7 shareholder letter announcing Q3 earnings, Axon said it was introducing the AI Era Plan subscription for its rapidly expanding suite of AI features, many of which were previewed for attendees at the International Association of Chiefs of Police annual conference in October.
Drone As First Responder
Axon completed its acquisition of Dedrone in October, highlighting its ability to "detect, track, and when necessary, neutralize rogue drones in real time."
In the November letter, Axon said that, in conjunction with an autonomous drone docking solution from Skydio, it now enables fully remote-controlled launches, landings, recharging and "airspace deconfliction" for beyond visual line of sight (BVLOS) operations.
Further, Axon's live drone feeds are integrated into its Fusus real-time crime center display, providing "unified situational awareness."
Axon Earnings
Axon will likely report Q4 results in early March. Analysts expect Axon earnings per share to grow 25% to $1.40 as revenue rises 31% to $566.7 million.
Q3 EPS swelled 38% with revenue up 32% to $544.3 million.
Axon Stock
Axon is off 0.1% to 678.60 in Monday stock market action. The Taser maker has a 698.67 buy point from a nine-week cup base, according to a MarketSurge analysis.
Axon's relative strength line is at a new high, reinforcing its market leadership. The RS line is the blue line in IBD charts, tracking a stock's progress vs. the S&P 500.
According to IBD Stock Checkup, Axon has a perfect 99 IBD Composite Rating, which combines fundamental and technical factors into a single rating.
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