DCF Studio

    AXON · NMS · Industrials

    Axon Enterprise, Inc.

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 7.49

    Market price

    USD 425.43

    Implied upside

    -98.2%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    Wrong toolThis model values the shares at 1.8% of the market price. A gap that size is a modelling failure rather than a view - most often an unusable beta, a currency or units mismatch, or a cashflow base that does not represent the business. Read the figures below as diagnostics, not as a call.
    AdjustedFree cashflow is negative in at least one forecast year, so terminal value carries most of the valuation.
    AdjustedCapital expenditure runs at 4.3% of revenue against depreciation of 2.1%. A perpetuity has to be a steady state, so the forecast tapers capex to maintenance at depreciation plus the reinvestment terminal growth requires (g/ROIC of NOPAT), and the terminal year carries on from there. The bridge is shown under Terminal Value.

    Current EV/EBITDA of 1647.5x sits outside a defensible 3-20x band, so the exit multiple is capped at 20.0x. A multiple that far out usually means EBITDA is the wrong denominator for this business.

    Value Per Share

    Perpetuity growth
    USD 7.49-98.2%
    Exit multiple
    USD 70.01-83.5%
    Market price
    USD 425.43

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    -351m-30m290mFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 3.7bnUSD 4.8bnUSD 6.1bnUSD 7.4bnUSD 8.9bnUSD 10.3bnUSD 11.6bnUSD 12.6bnUSD 13.4bnUSD 13.7bn+15.7%
    EBITUSD 171.1mUSD 221.5mUSD 279.3mUSD 342.7mUSD 409.1mUSD 474.5mUSD 534.3mUSD 583.7mUSD 618.0mUSD 633.4m+15.7%
    NOPATUSD 148.6mUSD 192.3mUSD 242.5mUSD 297.7mUSD 355.3mUSD 412.1mUSD 464.1mUSD 507.0mUSD 536.7mUSD 550.1m+15.7%
    Add depreciation & amortisationUSD 78.8mUSD 102.0mUSD 128.6mUSD 157.9mUSD 188.4mUSD 218.5mUSD 246.1mUSD 268.8mUSD 284.6mUSD 291.7m+15.7%
    Less capital expenditureUSD -159.4mUSD -200.1mUSD -244.2mUSD -289.9mUSD -334.2mUSD -373.9mUSD -405.7mUSD -426.4mUSD -433.6mUSD -426.2m+11.5%
    Capex, % of revenue4.3%4.2%4.0%3.9%3.8%3.6%3.5%3.4%3.2%3.1%-
    Less increase in working capitalUSD -348.2mUSD -410.2mUSD -470.4mUSD -516.5mUSD -539.9mUSD -532.2mUSD -487.0mUSD -401.9mUSD -278.9mUSD -125.7m-10.7%
    Free cashflow to firmUSD -280.3mUSD -315.9mUSD -343.4mUSD -350.9mUSD -330.4mUSD -275.5mUSD -182.6mUSD -52.5mUSD 108.8mUSD 290.0m-
    Discount factor0.95250.86410.78390.71120.64520.58530.53100.48170.43700.3965-
    Present valueUSD -266.9mUSD -273.0mUSD -269.2mUSD -249.5mUSD -213.1mUSD -161.2mUSD -97.0mUSD -25.3mUSD 47.6mUSD 115.0m-
    Present Value Of The ForecastUSD -1.4bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta1.314Reported 1.468, pulled toward 1.0 (Blume)
    Cost of equity10.45%Risk-free + beta x equity risk premium
    Cost of debt7.16%Interest expense / average total debt
    Market capitalisationUSD 34.6bn94.8% of capital
    Total debtUSD 1.9bn5.2% of capital, book value as a proxy
    Tax rate13.1%Effective, capped at statutory
    WACC10.23%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 7.49

    276% of EV

    Forecast FCFF, final year
    USD 290.0m
    Capex at depreciation, working capital in reinvestment
    USD 550.1m
    Less reinvestment at g/ROIC (24.4% of NOPAT)
    USD -134.5m
    Capitalised
    USD 415.7m
    ROIC (WACC floor)
    10.2%
    Terminal value, undiscounted
    USD 5.5bn
    Terminal value, discounted
    USD 2.2bn
    Enterprise value
    USD 792.8m
    Less net debt
    USD 175.9m
    Equity value
    USD 616.9m

    Exit at 20.0x EBITDA

    Value per shareUSD 70.01

    123% of EV

    Terminal value, undiscounted
    USD 18.5bn
    Terminal value, discounted
    USD 7.3bn
    Enterprise value
    USD 5.9bn
    Less net debt
    USD 175.9m
    Equity value
    USD 5.8bn

    Spread between methods: 161%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    8.23%20.0719.3018.5317.7616.99
    9.23%13.5612.9112.2711.6210.97
    10.23%8.598.047.496.946.39
    11.23%4.734.253.783.302.83
    12.23%1.681.270.860.440.03

    Outlined: this model. Green text: above today's price of 425.43. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year32.8%17.3%101.4%
    EBIT margin10.0%4.6%44.1%
    Discount rate-10.2%3.2%
    Download as Excel

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    Yahoo Finance and RBA data. General information, not advice. Methodology.