The NYPD Delivers Body Blow to TASER International, Inc. (NASDAQ:TASR)

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Shares in TASER International, Inc. (NASDAQ:TASR) staggered yesterday after media reports claimed that the NYPD clinched a $6.4 million, five-year deal with Taser rival Vievu for the supply of 1,000 body cameras as well as technical support.

TASR closed lower by 15.1% at $24.29 on volume of 8.06 million shares.

Additional bad news struck Taser when the Supreme Court ruled that police used “excessive force” by using a Taser stun gun on a mentally ill man five times inside the span of two minutes, resulting in the latter’s death.

According to Reuters, the Richmond, Virginia-based 4th U.S. Circuit Court of Appeals found that the officers violated U.S. Constitution’s Fourth Amendment by using excessive force. The verdict casts a shadow on the use of weapons made by Taser.

TASER International, Inc. (NASDAQ:TASR) downgraded

Analysts at Ladenburg Thalmann reduced their take on Taser by a notch from Buy to Neutral citing heavier competition, while Craig-Hallum stood by their Buy rating and a $33 price target, claiming Vievu had signed off on a highly unprofitable contract.

Ladenburg Thalmann analyst Glenn G. Mattson said: “We contend that Vievu may have difficulty making a reasonable return at these terms, but believe the company was likely looking for a reference account that could help it grab further market share.”

The analyst further said that nevertheless, Vievu’s win could trigger “a potential shift in the market backdrop coupled with elevated valuations.”

But TASER International, Inc. (NASDAQ:TASR) had its own share of wins…

Last week, Taser received an order for 1,604 X26P Smart Weapons from the Las Vegas Metro Police Department.

Earlier, on September 21, it was reported that Taser won an order for the supply of 1,015 Axon Flex and Body 2 cameras from the Atlanta Police Department.

In August, Taser reported Q2 EPS of $0.07, which beat by $0.03. Quarterly revenue was $58.8 million, up 25.9% year-on-year and ahead of estimates by $4.38 million.

The quarter was a record one for Taser both in terms of revenue and bookings.

“Axon bookings reached a record $72 million for the period and right now our 2016 bookings for the first half of the year are approaching the full year bookings from 2015,” said Rick Smith, Taser’s CEO and Founder on the earnings call.

 

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