TASR doesn't even get notice in the Wall Street Journal or Barron's when they report earnings. In what magazine would they place an ad? You don't think LE already knows that TASR has been selling cameras for years? Government contracts have their own life, having to live with a budget approved by city councils. Only now are city budgets improving after the financial crisis. This isn't like private industry where the CEO simply says "buy it" and it gets done. London Metro conducted a two-year pilot program before they made a decision. NYPD will take months before they make a decision evaluating vendors. With MSI entering the fray, at least one PD is delaying their decision so they can review MSI's new camera.
Earnings have a long way to go to catch up with the stock price. Or, the stock price declines to where the PE and PEG ratios for the stock are reasonable with only 17% revenue growth.
Value is irrefutable? Is that why institutional accounts sold eight million shares (one in seven shares outstanding) in the most recent reporting period?
Yes. Studies show that camera usage decreases use of force by police in addition to reducing complaints by civilians. The former has surprised police chiefs more than the latter. The Border Patrol recently rejected use of cameras. You can imagine that police overseas sure don't want evidence of what they do to their civilians. They don't want transparency. In France, you're guilty until you prove your innocence. Why would they want transparency where the camera video may show your innocence (and against them)? Yet Rick spent six months overseas in 2015 while TASR had "long-term gaps in its organization." You can't dream this stuff up.
Some drug addicts could be rehabilitated. Tasers in the hands of the general public is worrisome. They know less about using them tasers than the police. Hey, if one charge from a taser is good, two are better. Keep pressing that trigger.
They go by the dated philosophy of losing money on each one but making up for it on volume.
Rick spent SIX MONTHS overseas building their international organization. After three-fourths of the year is complete, they realize that unit is going to lose money in 2015. And profitability for that unit in 2016 is unclear. Meanwhile they have "long-term gaps in their organization." (Source: the recently posted transcript of their latest conference call).
According to the data here at Yahoo Finance, some 8 million shares were sold in the last few months by institutional accounts. Their ownership is down to 79%.
Properly trained police officers know you only tase a person once. But you tase them three consecutive times, sure they are going to die.
Introduced last month, I wonder how PDs that bought the Axon body earlier this year feel about not having the latest and greatest. LAPD started deliveries this past summer, and it extends through next summer, so they have been receiving the old model. Or is there another writedown due to obsolescence in the cards for 4Q, like in the past, if LAPD and others want to upgrade?
Have to love Rick's comments in the cc. (a) He says his theoretical exercise is not going to hold true. No kidding. He assumes a gross margin of 65% when it was 61% in 3Q15. And he somehow magically converts gross profit into operating profit, neglecting SG&A. Hey Rick, if you incorporate an operating margin of about 20% to that additional $26M in revenue you were talking about, it comes to around $5M and change. Combine it with the $7.3M loss and you still get around a $2M operating loss in the Axon unit, not a $9.6M operating profit. Does this "highly profitable at scale" business need an additional $30M - $40M to reach break-even? (b) Then they are hiring new managers overseas. Are they genuinely new or replacing ones that didn't work out? (c) Gotta love how he wants to talk about non-GAAP to support his thesis. (d) Then the CFO talks about free or highly discounted cameras. That sure helps Axon's bottom line. I remember a diagnostic company giving the product away to make money on the recurring revenue (they are now out of business). I hope playing this Gillette game (give the razor away but make money on the blade) works out. Their discounts are increasing. (e) 19 more sales and marketing people for smaller sales regions. I bet their sales people love limits on their income due to the smaller area served. Goodness, we can't let them make too much money. 3M did this to their salespeople too, and many left. (f) "Long term gaps in our organization"? (g) And now, after the 3Q is completed, TASR management no longer expects their international segment to be profitable in 2015. Their determination if the international segment will be profitable in 2016 is unclear. (h) the initial body camera is not an HD camera (Rick refers to Body 2 as being an HD camera). (i) Greater competition ("There's a lot of competitors out there....") has lengthened the sales cycle. (j) With 17% revenue growth YOY for 4Q, it's hard to justify this stock price with a PE about 45 (PEG above 2)
Hard to say. All the cameras (Flex, Body and Taser) and video storage cost figures are lumped together in the Axon unit financials. Only their accounting department would know the details. Based on revenue and unit count, body cameras sold for an average of $239 during the 3Q15, down 20.1% YOY.
JNJ will provide clinical and behavior know-how, IBM will provide Watson's cognitive computing and analytics platform, and Apple will offer its user experience design. Source: 9/30/15 WSJ.
Same with the unicorns. Some are already folding, and private equity firms holding investments in them are taking substantial hits on revaluations. Not that TASR will fold, but the vision in the marketplace is changing to value vs. growth. That's not good for TASR's stock price. It's PEG ratio exceeds 2x (pricey in any market).
LTM foreign revenue for period ending 3Q14 was $32.8M; LTM for period ending 3Q15, $33.9M, or 3% growth.
Mass surveillance cameras already exist. In California, they are at intersections with blinking blue lights on them, recording everything in the intersection. Those cameras have helped solve hit and runs. But society isn't ready to accept Big Brother yet to "protect" them by having the cameras everywhere. It's bad enough it intrudes on our phone calls.