Although the fundamentals at Taser have certainly improved and the concern about wrongful death lawsuits has been largely mitigated, we think shares of Taser have outpaced the underlying business fundamentals. In the most recent quarter announced this morning, Taser posted earnings of $3.7 million on sales of $25.9 million. These numbers handily beat analyst estimates, but with a forward P/E that is still over 50, we think this is a good time to take profits in Taser.
Taser bulls will argue that the big French order promised by Nicolas Sarkozy before the French election has yet to materialize. Although a large order from France will likely produce yet another jump in Taser shares, we prefer not to wait around for a slow moving French government.
Sell TASR near $18.40
TASR 1-yr. chart: