Before market indexes fell on Thursday, the IBD 50 member Axon ( AXON ) is up more than 23% over the past month. The stock is currently testing its support at its 10-week moving average.
Axon, formerly known as the Taser, has a goal of cutting gun-related deaths among police and the public by 50% within 10 years. In the year In 2021, 1,118 such people died.
Based in Scottsdale, the company provides safety and security solutions to a variety of industries, including law enforcement, corrections, campus, personal security and more.
Earlier this month, the security technology leader’s cloud-based software as a service (SaaS) solutions received an upgrade to a higher security level by the Federal Risk and Authorization Management Program (FedRAMP) Joint Licensing Board.
The change would allow Axon’s government customers to store unclassified information handled by federal civilian agencies.
The Axon FedCloud system operates as an independent suite of Axon Cloud services for the US federal community. Its offerings include Axon Evidence, Axon Respond and Axon Records. It also acts as a central control center for Axon devices and client applications.
Axon ensures support among the best mutual funds
along with Napco security (NSSC), Axon locks in a top position in the safety-security industry group. Both stocks received a strong 97 composite rating in StockCheck. The industry ranks 23rd among 197 groups of IBD tracks.
Demonstrating strong institutional support, Axon has made the latest list of new acquisitions by well-stocked mutual funds. The company carries a “B+” stock/distribution rating and an impressive 1.9 upside/down volume ratio. Additionally, 68 funds with an “A+” or “A” rating own shares in AXON stock.
Quarterly revenue growth was mixed, from stellar to stagnant. But over the past three years, Axon has averaged EPS growth of 47 percent.
Except for a 4% slowdown in Q4 last year, sales have been strong and steady. In seven of the last eight quarters, revenue growth has ranged from 31 percent to 55 percent.
Can a security stock lock in support at the 10-week line?
After reporting earnings on Nov. 8, Axon posted a one-day gain of nearly 15%. It continued to rise, ending the week up more than 23%. The stock ran into resistance and traded sideways until it pulled back earlier this month.
The security technology leader appears to be finding support at its current 10-week line as market indexes are coming under pressure.
Both the relative strength line and the 10-week line rose after Tasser Pioneer bounced off the May low. But the sell-off in market indices has caused the RS line to slide below previous highs.
With current market conditions putting all stocks at risk, see if Axon can shake off that selling pressure and build on its massive gains since its October exit.
Follow Matthew Galgani on Twitter @IBD_MGalgani.
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