I've owned this company off an on for years. They are past all of their barriers and now are busting it wide open. Since 2008 they have bought back shares from 64Mln now down to 53Mln with market cap of $907 Mln and almost no debt; current ratio > 4.
These guys are changing policing globally in a very big way and have essentially no competition that I am aware of. Here's a few points I've observed over my time of involvement.
1. The supply hundreds of police and military entities around with world with Taser guns which have about a 5 year life. They are on the front end of a major replacement cycle campaign which enables them to predict future revenue streams very well. The product has been upgraded with 2 and 3 shot products, mounted lasers and cameras, smart electronics which record the amount of energy pulsed to the tased offender. There is a solid revenue stream in supplying replacement cartridges by the 10's or maybe 100's of thousands each year and growing. They also have Tasre gun products attempting to break into the consumer market. A few states have laws regarding consumer ownership, but most don't. That's working, but not a major revenue generator.
2. Lately they reached critical mass with their on officer cameras and Evidence.com cloud based software which captures the on officer or other cameras video storing it in the Cloud based software to "protect evidence" for later use in solving the crime or as evidence in court. The on officer camera concept is revolutionary and was at first received with some skeptcism, but now the dam has burst and demand is skyrocketing. A New York judge this year ordered a police force to acquire the technology. That had a nice impact on the stock price. Taser slashed the price of the cameras and offers various type of mounting capabilities (on your sunglasses; on your body; etc.), recognizing that high prices there only invite lots of competitors of easy to duplicate cameras. Instead the value is in the software and service. The market, initially not liking that, now realizes it is the correct strategy. So the new revenue stream from this is rapidly expanding and is only in its infancy.
3. In addition to the above, the management is very smart. Their ace legal team has defeated about every lawsuit for wrongful death claims (and there have been many) and then has the charges exponged from the records. A "leave no trace" policy. They have had multiple medical studies all agreeing that in these cases the Taser was not the cause of death, but rather other factors which involved the physical struggle, drug addicted body and other health matters of the offenders. This has resulted in a mountain of legal victories such that cases are rarely filed any more. This earlier risk scared many investors away, including Jim Cramer on CNBC who said regarding the pending lawsuits at that time, "Taser scares me to death." Additionally, Taser has changed its marketing of the weapons from being "non lethal" to instead being offered as "less lethal." The point is that officers have a range of force to use including deadly weapons when an incident arises and there are risks and tradeoffs they have to instantly consider which includes protecting their own life and the lives of other innocents. Apparently, the courts whole heartedly agree. They have mounted a marketing campaign that has gained much traction in estimating how many lives and serious injuries Tasers have AVOIDED. Their strategy is brilliant. Its a huge number, growing everyday. The evidence has shown that offender injuries and officer injuries and deaths have been substantially reduced due to the mere presence of Tasers. Typically an officer arcs the electrodes prior to firing in order to pursuade the offender. That alone ususally ends the incident. The result is that workmans comp claims for injured officers have plummeted at departments using Tasers. Departments now realized Tasers more than pay for themselves and protect their staff from injury and death. Costs are down. The on officer camera technology has a similar but different benefit. False claims against officers for alleged abuse or false arrest drop to near zero when the cameras are in use. The keeps the officers on the beat and out of the office and courtrooms. Again, a huge cost reduction.
In summary Taser management have brilliantly matured their understanding of how to win. They have two virtual monopoly product/service lines in the global law enforcement business. The first - the Taser ECDs is locked in but still growing. The second, on officer camera and Evidence.com, is now exploding. It's a USA based company in Scotsdale, AZ. They are on a long upward climb.
