Stock To Watch: Taser International (TASR) In Perilous Reversal

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Taser International ( TASR) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Taser International as such a stock due to the following factors:

  • TASR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $51.8 million.
  • TASR has traded 2.5 million shares today.
  • TASR is down 3.2% today.
  • TASR was up 11.9% yesterday.

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More details on TASR:

TASER International, Inc. is engaged in the development, manufacture, and sale of conducted electrical weapons (CEWs) for use in law enforcement, federal, military, corrections, private security, and personal defense markets worldwide. TASR has a PE ratio of 47.5. Currently there are 3 analysts that rate Taser International a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Taser International has been 1.4 million shares per day over the past 30 days. Taser International has a market cap of $823.2 million and is part of the industrial goods sector and aerospace/defense industry. The stock has a beta of -0.04 and a short float of 7% with 0.79 days to cover. Shares are up 10.4% year-to-date as of the close of trading on Tuesday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Taser International as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 1.4%. Since the same quarter one year prior, revenues rose by 15.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • TASR's debt-to-equity ratio is very low at 0.00 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 3.54, which clearly demonstrates the ability to cover short-term cash needs.
  • Compared to its closing price of one year ago, TASR's share price has jumped by 31.45%, exceeding the performance of the broader market during that same time frame. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
  • The gross profit margin for TASER INTERNATIONAL INC is rather high; currently it is at 65.42%. Regardless of TASR's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, TASR's net profit margin of 10.44% compares favorably to the industry average.
  • TASER INTERNATIONAL INC's earnings per share declined by 12.5% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, TASER INTERNATIONAL INC increased its bottom line by earning $0.34 versus $0.27 in the prior year. For the next year, the market is expecting a contraction of 5.9% in earnings ($0.32 versus $0.34).

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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