Taser Misfires but Still Has Potential

Electric stun-gun maker Taser International(TASR Quote) seems more of a venture capital play than a conventional stock play on the basis of company's recent earnings and news.

Earnings for the quarter ended March 31 were nothing to write home about, amounting to only 1 cent a share on $15.3 million in sales. For 2007, the company is now estimating earnings of 10 to 15 cents a share on $65 million in revenue, a far cry from earlier expectations of 25 to 30 cents a share on $70 million in revenue. As a result, there was some downward pressure on the stock, which is currently down 49 cents, or 5.72%, to $8.07.

Company executives claimed to be encouraged by other first-quarter developments on Wednesday's conference call, pointing to the fact that some 14 product liability wrongful death lawsuits were recently dismissed, inhibiting new lawsuits, which are now being filed at a reduced rate.

Also, Richard H. Carmona, a former U.S. surgeon general with a military background, signed on to the company's board, and some scientific breakthroughs vindicated earlier R&D spending. And although higher material costs took a toll on company profits, a number of bugs were worked out of its manufacturing process, hopefully reducing costs down the line. ...