Taser stuns the market

Taser International Inc. (NASDAQ:TASR) shares are up over 5.5% today on heavy volume after the company reported strong sales in the fourth-quarter that boosted profits for the stun gun maker.

Despite many controversies regarding its products, Taser has managed to grow profits for four straight quarters. For the fourth-quarter, net income grew to $2.3 million, or 4 cents per share, from $179,126, or breakeven per share, in the year-ago period. Revenue rose 53% to $19.3 million from $12.6 million. Analysts surveyed by Thomson Financial expected 4 cents earnings per share on revenue of $19.2 million.

While the market is happy with the results, Taser is far away from the highs it reached in 2004 when safety concerns over the use of the TASERs and a SEC investigation hit the company The government ordered a two-year study by the Department of Justice (yet to be completed) and Amnesty International called the stun guns inhumane. The SEC also investigated the company's accounting practices back then. The investigation ended in 2005.

The company mentions in the report that courts dismissed seven more suits related to wrongful deaths from TASER use, but just last month yet another Taser controversy about police use of the guns made the headlines. Despite all that, it seems customers keep coming back for more, and for now, that's what matters to investors.

If the company continues its growth without new controversies to shake it or competition to speak of (competition remained weak so far), the stock should continue to do well as law-enforcement agencies domestically and around the world continue to adopt this nonlethal (or as some would prefer, 'less-lethal') gun. And lest we forget the opportunities in the personal market as well.