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Axon:

  • Writer: Abacus Research
    Abacus Research
  • Feb 2
  • 1 min read

Axon is shifting from selling individual tools to providing an interconnected ecosystem. Hardware like TASERs and cameras now act as "data generators" that feed directly into high-margin software modules.

  • Axon is a play on increasing digitization and AI adoption in police and public safety.

  • The business is also branching out internationally and into enterprise security & safety, both of which look to have solid tailwinds.


Yes, Axon has been caught up in the SaaS sell off, and not been aided by a poor 3rd Q, where incremental EBITDA margins were not good enough.

  • Poor incremental EBITDA margins, especially in this risk-off environment – remains a short-term risk, we think.


However we believe that Axon is a unique AI beneficiary where the market might be mispricing its defensive moat and the sustainability of growth.


Potential Upside:     20% IRR

Sensible Downside: $417(-14%)



 
 
 

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