Axon Enterprise, Inc. (AXON)

FairStock Score: 20/100 — RISKY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

As a value investor, I begin with the business and the price. Axon provides public-safety technology, largely software and connected devices. Revenue is climbing: in fiscal Q2 2026, the quarter ended 2026-06-30, revenue was $904.4M versus $668.5M in fiscal Q2 2025, the quarter ended 2025-06-30. That is strong top-line momentum. Profit tells a different story. Fiscal Q2 2026 net income was $29.4M, down from $36.1M in fiscal Q2 2025, and diluted EPS was $0.36 versus $0.44. Fiscal Q1 2026 brought $169.3M of net income and $2.05 of diluted EPS, so results are lumpy. For FY2025, revenue was $2.8B, net income $124.7M, and diluted EPS $1.51, against FY2024 revenue of $2.1B, net income of $377.0M, and diluted EPS of $4.80. The FairStock Lynch category is Slow Grower — Shrinking, with profit down 5.3% a year over three years despite revenue growth. Returns are weak: ROE 6.22% and ROCE 0.51%. At the 2026-10-13 close, the price was $413.35, with FairStock calculations showing P/E 170.81, P/B 9.14, FCF yield 0.4%, and EV/EBITDA 85.71. The FairStock Graham Number is $49.63, so the market price is far above that asset-and-earnings-based reference. Altman Z 5.90 suggests low distress risk, and D/E 0.50 is manageable. Yet with a FairStock score of 20/100, negative profit growth, and thin cash generation relative to market cap, the narrative is priced for perfection. I require a margin of safety; here it is negative 732.86%. Until earnings and cash flow catch up, this looks speculative rather than defensive.

In plain English: Axon sells technology to police and public safety agencies, including cameras, cloud evidence software, and connected devices. Revenue is growing quickly, but profits have been uneven and fell in the latest reported quarter, while the shares look very expensive compared with current earnings and cash flow. The business may have a strong position, but the price leaves little room for error.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-Q (period ended 2025-09-30) · fiscal Q2 2025 10-Q (period ended 2025-06-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer