Key Stats for Axon Stock
- Current Price: $390.29
- Target Price (Mid): ~$1,240
- Street Target: ~$691
- Potential Total Return: ~217%
- Annualized IRR: ~32% / year
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What Happened?
Axon Enterprise (AXON) fell 6.45% to $390.29 on October 16, a day after rising 2.15% on the day it announced that the Department of Homeland Security chose its Dedrone counter-drone platform. Axon issued no new release on October 16, and the Nasdaq Composite sank 2.1% that day, but Axon fell about three times as much. Shares are down 31.28% in 2026 through October 16. Results and guidance sit in Axon’s investor relations materials.
DHS Chose Dedrone, but Axon Has Not Said What It Is Worth
Axon said DHS chose Dedrone under an IDIQ contract for critical infrastructure protection. According to the release, federal agencies also added more than 22,000 body cameras and evidence licenses this year, and the VA added more than 1,600 TASER 10 devices. Axon disclosed no dollar values. An IDIQ sets terms for future orders, so revenue depends on orders DHS has not disclosed.
At a Goldman Sachs conference on September 8, Chief Financial Officer and Chief Operating Officer Brittany Bagley said Axon had been named as part of the federal counter-drone contracts. “Still too early to tell what that means in terms of how they’re splitting up those dollars across products,” she said. The October 15 release does not say how much DHS will spend.
The base is already real: Dedrone revenue surpassed $100 million in the second quarter. On October 15, Raymond James lowered its target to $675 from $800 and kept an Outperform rating. That target sits below the Street mean of about $691 across 19 analysts.
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Axon’s CFO Hopes Memory Costs Ease in 2028
“Our cameras are the one area that really are getting hit by the increase in memory costs,” Bagley said at the same conference. “Hopefully, with some new capacity coming online, that starts to change in 2028.” She added that “we also can look at pricing.”
Analysts expect gross margin to rise from 59.70% in 2025 to about 61% in 2026 and about 63% in 2028. With memory relief not expected before 2028, that path leans on pricing and mix. Bagley said software “continues to be above 80%” and that investors should not assume Dedrone’s hardware is “forever a drag on our connected devices margin.”
Axon’s NTM P/E fell from 82.19x at the end of 2025 to 43.53x, while full-year 2026 revenue consensus rose about 8%. The multiple still sits above General Electric (GE) at 37.07x and Howmet Aerospace (HWM) at 37.37x in TIKR’s aerospace and defense peer group.
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TIKR Advanced Model Analysis
- Current Price: $390.29
- Target Price (Mid): ~$1,240
- Potential Total Return: ~217%
- Annualized IRR: ~32% / year
See analysts’ growth forecasts and price targets for Axon stock (It’s free!) >>>
The mid case assumes revenue growth around 23% a year, below Axon’s 33.5% in 2025. Its net income margin near 19% matches 2027 consensus and sits above the roughly 17% analysts expect for 2026. That means the case needs margins to recover from this year’s squeeze, which is where memory costs and pricing decide the outcome.
On the upside, disclosed DHS orders would add a federal growth source. On the downside, the low case assumes growth around 21% and a 17% margin.
Conclusion
On the model’s math, the answer leans toward loading up, with margins as the test. Axon has not announced its third-quarter date.
Consensus calls for about $939 million in revenue and $232 million in EBITDA, a margin near 25%, close to the 24.9% of the third quarter of 2025. Matching or beating that would support the pricing-and-mix argument. A margin well below it would show memory costs biting harder than Bagley expects, and it would put Axon’s 25.5% full-year adjusted EBITDA margin guidance at risk.
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So what is Axon stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
