From Nasdaq: 2025-02-27 07:22:00

Shares of industrials company Axon Enterprise (NASDAQ: AXON) started strong in 2025 but fell nearly 30% over four days due to analyst downgrades and federal budget cut concerns. However, Q4 earnings impressed with revenue growth of 33% and a huge new customer relationship, showing potential for long-term success.

Federal budget cut concerns raised questions about Axon’s revenue dependency on the U.S. government. While around a third of revenue comes from federal contracts, recent Pentagon reallocations and House budget bills may balance out potential cuts. Axon also raised its Total Addressable Market estimate, indicating less reliance on federal spending.

Axon’s latest earnings exceeded expectations with adjusted EPS up 81% from last year and revenue growing by 33%. The company secured its biggest enterprise deal ever and future contracted bookings are nearly five times higher than 2024 revenue, indicating less reliance on federal contracts and strong growth potential.

Axon’s valuation, trading at a forward P/E multiple of 100x, may lead to near-term volatility despite analyst targets showing potential upside of nearly 26%. With the company still less than 2% penetrated into its Total Addressable Market, there is a strong opportunity for long-term appreciation, although valuation concerns remain. 1. The stock market hit record highs today, with the S&P 500 reaching a new peak of 4,500 points. This marks a significant milestone for investors as the market continues to show strong growth despite ongoing economic uncertainties.

2. In other news, the latest unemployment numbers show a decrease in jobless claims, with only 350,000 new claims filed last week. This is a positive sign for the labor market as businesses continue to hire and the economy shows signs of recovery.

3. Scientists have discovered a new species of dinosaur in Argentina, named Llukalkan aliocranianus. This carnivorous dinosaur had a unique skull structure and is believed to have lived during the Late Cretaceous period. The discovery sheds new light on the diversity of dinosaurs in prehistoric times.

4. The United Nations has issued a report warning of the urgent need to address climate change, stating that the world is on track to exceed the 1.5-degree Celsius temperature limit set in the Paris Agreement. The report calls for immediate action to reduce greenhouse gas emissions and mitigate the impact of global warming.



Read more at Nasdaq:: Axon: Long-Term Outlook Is Strong Despite Federal Budget Worries