I’m new to this board and notice that you guys are really detailed in your analysis! If you haven’t come across this stock, I suggest that you look into it. Here are just a few items:

  1. They are known for their TASER stun guns.
  2. Their revenues went up 14% year over year- nothing impressive compared to those SaaS you guys are looking at.
  3. They are being sued by Digital Ally (DGLY) for patent infringement and have lost all six challenges.

4) They also make police body cameras and are actually going to be an SaaS company, due to their evidence.com. From their website: “…You’re collecting more data than ever — and Evidence.com can help you make the most of it. Our robust, cloud-based system stores all your data — from body-worn cameras to audio records — while streamlining data management and sharing. Feel confident with Evidence.com’s simplified, comprehensive evidence management system.”
5) 48 major cities in North America use their cameras and software. I believe that they are giving this away for free to some cities for five years for them to try out. That’s why it’s not showing up on the bottom line- for now. Once cities get hooked using their software, then the money starts coming in. Police spend a lot of time piecing evidence together. The software gathers all the videos shot from the body cameras and saves a lot of time for the cops.
6) This is purely guesswork: 5) keeps the profits down. If they eventually lose the lawsuit, they can claim that there’s little or no financial damage from the patent infringement.
7) It is believed that DGLY is asking for $550 million in damages. AAXN made a secondary offering a few months ago- for expansion. Many think that it was to pay DGLY.
8) Once law enforcement gets hooked on their evidence.com, you have one of Saul’s favorites ingredients- RECURRING REVENUE.
9) They are the only player in this law enforcement space- That’s a monopoly! DGLY is a shell company whose only existence is to sue AAXN. DGLY basically makes nothing!
10) From Motley FooL;https://finance.yahoo.com/news/why-axon-enterprise-stock-ros…
“Analyst Brian Gesuale lifted his rating from outperform to strong buy but maintained his price target at $79. Gesuale also said the company’s stock could hit $100 a share by 2021, arguing that the power of the company’s growing subscriber base is being underestimated. He also said that the business is still being valued like a hardware company, even though its emerging cloud business could deliver significant profit growth, and noted that software sales made up just 2% of revenue in 2014, compared to 20% in 2018, a sign of the shift in the overall business.”



Hi DoesMIWork,

AAXN used to be called Taser. It is based in the town I live in, so when I was a shareholder I attended the annual meetings. Investors who bought shares early on and held them did very well.

But the company faced many issues, ie- lawsuits by people whose loved ones died after being “tasered,” patent infringement, etc. One of the issues I had with the company was their management. Just one example, they touted tasers as “non-lethal” for a long time before finally conceding that tasers are “less-lethal.” That tended to lend more credibility to management, but the stubbornness(?) of the CEO troubled me.

I was present at the annual meeting where “evidence.com was announced”. It seemed to me to be a really good idea, primarily because, as was explained by the CEO, the footage from the cameras could not be manipulated. I don’t recall how many years ago this was, but it was while I was still a shareholder so it had to be more than 5 years ago, I would say.

In any event, back then it was basically a hardware company and even though more and more law enforcement agencies seemed to be ordering tasers, the share price seemed to languish. That, coupled with my reservations with management, caused me to sell my shares. I haven’t followed the company since, so I don’t what percentage of their revenue is from evidence.com versus sales of tasers and/or body cams, but in my view there are so many other great companies out there right now with very good leadership that I cannot imagine ever investing in this company again. Just my 2 cents.


Notes and trends

  • Body cameras > Tasers for this company

  • Body cameras are growing requirement for law enforcement and evidence retention

  • Evidence.com is the moat here

  • Axon building upon Evidence.com with Axon Records this fall (AI to help auto fill reports from video evidence)

  • Body cameras will soon be streaming live for interdepartmental cooperation (this Fall)

  • Axon executive pay structures are heavily built on stock performance and revenue growth, so shareholder value is executive value


  • Axon gives away up to 5 years of Evidence.com to new customers

  • Pricing power of the software platform feels like a slow burn versus a hyper growth company

  • The DGLY lawsuit…I guess…not very concerning.

  • Legacy Tasers seems like a drag…although Axon is doing great work on innovations to drive products together (ie take the weapon from the holster and camera begins recording

  • growth opportunities in cameras and software seem to be out of touch with company’s original mission so talent to support the pivot is always interesting to consider

Future outlook

  • no competition
  • growing moat
  • Seeking to disrupt records mgmt law enforcement
  • further ambition into dispatch

Just a Fools thoughts


I was wrong about the amount that DGLY wants from AAXN.

From https://www.bizjournals.com/kansascity/news/2019/04/08/digit…

“Patents have been incredibly important for Digital Ally, which has two big lawsuits going against competitors that are accused of infringing on its technology. A lawsuit against Axon is the biggest, seeking $204 million, which includes $68.46 million in damages that Digital Ally wants trebled for “willful” infringement. Axon has tried and failed six times to invalidate Digital Ally’s patents. However, Axon remains undaunted, continuing to launch a defense rather than seek a settlement.”