Jim Cramer on Axon: “It Sells at a Very High Price to Earnings Multiple”

Axon Enterprise, Inc. (NASDAQ:AXON) was among the stocks on which Jim Cramer gave his opinion, as he warned that increased AI-related spending might cause near-term headwind for stocks. Mentioning that they own shares of the stock, a caller asked if they should buy more, sell, or hold. In response, Cramer said:

No, I want you to hold it. I want you to hold it. You know, look, the only reason I don’t tell you to sell is because I know that the product is, you know, their products are doing well, but the problem is it sells at a very high price to earnings multiple. Now, people don’t understand the M. This is why I wrote How to Make Money in Any Market. The M is the secret sauce, and the M’s too high, and people are selling that because of it.

Photo by Artem Podrez on Pexels

Axon Enterprise, Inc. (NASDAQ:AXON) develops and sells TASER devices, body and fleet cameras, and software solutions that help law enforcement capture, store, and manage digital evidence. During the May 15 episode, a caller noted that they have been holding the stock since 2015, when the share price was $34 on Cramer’s suggestion, and inquired about it. Cramer replied:

Well, they had, you know, Axon was on today. I thought they acquitted themselves, which is why I think why the stock was up three bucks. I have been, we were very worried about Motorola competition when we met with them when we were up at Harvard Business School. I am still concerned about that, and I still think that this market does not like high multiple stocks, and Axon is a high multiple stock.

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