Craig-Hallum upgrades Axon Enterprise stock to Buy on strong growth

Investing.com - Craig-Hallum upgraded Axon Enterprise (NASDAQ:AXON) from Hold to Buy on Tuesday, raising its price target to $900.00 following the company’s impressive Q2 results. According to InvestingPro data, the stock has delivered a remarkable 160% return over the past year, though current valuations suggest the stock is trading above its Fair Value.

The research firm cited reaccelerated bookings and Annual Recurring Revenue (ARR) growth in Q2, with bookings expected to reach the high 30% range in fiscal year 2025. This growth trajectory could potentially support 30%+ growth in FY26 and FY27.

International segment performance was particularly strong, showing its greatest growth in at least eight years, including a significant contract in Africa. The firm also highlighted the drone market as a rapidly growing opportunity for developing relationships both domestically and internationally.

Craig-Hallum noted that Axon’s new OSP AI Era Plan creates potential for larger contracts with higher average selling prices due to significant customer savings. The company also raised its capital expenditure guidance largely due to demand for its TASER10 product line.

The upgrade follows Craig-Hallum’s earlier downgrade of Axon earlier in 2025, with the firm acknowledging that previous concerns about potential pullbacks in federal contract spending and tariff risks have largely been addressed.

In other recent news, Axon Enterprise reported impressive financial results for the second quarter of 2025, with earnings per share hitting $2.12, significantly above the consensus estimate of $1.44. The company’s revenue reached $668.5 million, representing a 33% year-over-year increase and surpassing the forecast of $641.0 million. This strong performance led to several analysts adjusting their price targets for Axon. TD Cowen raised its price target to $925, citing the company’s robust quarterly performance and revenue growth that exceeded Wall Street expectations by 4.4 percentage points. Similarly, Raymond (NSE:RYMD) James increased its target to $855, highlighting strong results driven by new products and increased market share of core solutions. Needham also raised its price target to $870, attributing the increase to strong AI bookings and overall performance. Additionally, Citizens JMP reiterated a Market Outperform rating with a price target of $825 following the strong earnings report. These developments reflect a positive outlook from analysts on Axon’s growth trajectory.

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