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On Wednesday, Citizens JMP analyst Trevor Walsh maintained a Market Outperform rating for Axon Enterprise (NASDAQ:AXON) with a steady price target of $725.00. Walsh highlighted Axon’s impressive financial performance in the fourth quarter of fiscal year 2024, building on the company’s strong track record of 32% year-over-year revenue growth and industry-leading gross margins of nearly 60%. The company surpassed expectations with a non-GAAP EPS of $2.08, significantly higher than the consensus estimate of $1.43. Revenue also exceeded forecasts, reaching $575.1 million, a 34% increase year-over-year, compared to the anticipated $566.7 million.
The adjusted EBITDA for Axon in the quarter was another area where the company outperformed, registering at $142.0 million, up by 56% year-over-year, and surpassing the consensus of $138.7 million. Despite these strong results, Axon’s stock has experienced a decline of approximately 8% year-to-date, even after a 13% rise in after-market trading. This performance contrasts with the slight increase of around 1% in the Russell 3000 index over the same period. While the stock has seen recent pressure, InvestingPro data shows an impressive 83% return over the past year, though current analysis suggests the stock may be trading above its Fair Value. For deeper insights, investors can access 23 additional ProTips and comprehensive valuation metrics through InvestingPro’s detailed research report.
Looking ahead, Axon provided revenue guidance for fiscal year 2025, projecting a range between $2,550.0 million and $2,650.0 million. This forecast is in line with the consensus estimate of $2,566.4 million and slightly below Walsh’s projection of $2,615.4 million. Additionally, the company’s management set an adjusted EBITDA target of $640.0 million to $670.0 million for the same period, compared to a consensus estimate of $658.8 million and Walsh’s higher estimate of $687.0 million.
Walsh’s reiteration of the Market Outperform rating and the $725.00 price target reflects confidence in Axon’s continued financial growth and market performance, despite the recent downturn in its stock price.
In other recent news, Axon Enterprise reported impressive fourth-quarter 2024 earnings, exceeding analysts’ expectations with an earnings per share (EPS) of $2.08, compared to the forecasted $1.40. The company’s revenue reached $575 million, surpassing the anticipated $566.8 million, marking a 34% year-over-year increase. Axon also announced an increase in annual recurring revenue to $1 billion, up 37% year-over-year. Looking forward to 2025, Axon projects revenue between $2.55 billion and $2.65 billion, anticipating a 25% growth. Additionally, the company expects adjusted EBITDA to range from $640 million to $670 million. Axon continues to invest in research and development, particularly in AI, drones, and robotics, to maintain its competitive edge. The company has also been expanding its product portfolio, which includes AI and drone technology, and recently acquired FUSUS to enhance its capabilities. Analyst firms like Craig Hallum and Morgan Stanley (NYSE:MS) have shown interest in Axon’s federal market opportunities and potential impacts from funding cuts, but Axon remains optimistic about its federal market prospects.
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