Munro Partners, an investment management firm, released its “Munro Global Growth Fund” fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. In the December quarter, the Fund and MAET.ASX returned 10.4%. The Fund’s short positions and option hedging hurt performance while its long positions and currencies contributed. Artificial intelligence (AI) continued to be a dominant theme in the quarter. Global markets had mixed performance with regional differences in the performance of the equity market. For more information on the fund’s best picks in 2024, please check its top five holdings.
Munro Global Growth Fund highlighted stocks like Axon Enterprise, Inc. (NASDAQ:AXON), in the fourth quarter 2024 investor letter. Axon Enterprise, Inc. (NASDAQ:AXON) manufacturers conducted energy devices (CEDs) under the TASER brand. The one-month return of Axon Enterprise, Inc. (NASDAQ:AXON) was -5.98%, and its shares gained 131.27% of their value over the last 52 weeks. On January 17, 2025, Axon Enterprise, Inc. (NASDAQ:AXON) stock closed at $593.89 per share with a market capitalization of $45.287 billion.
Munro Global Growth Fund stated the following regarding Axon Enterprise, Inc. (NASDAQ:AXON) in its Q4 2024 investor letter:
“Axon Enterprise, Inc. (NASDAQ:AXON) contributed 45bps to Fund performance for the quarter. Axon Enterprises is a founder-led company based in Scottsdale, Arizona. Axon is a pioneer in developing products and technology centred around ensuring public safety. Axon’s core mission is to protect life, and this began when they developed a new version of a taser, with the objective of reducing gun-related death between the police and the public. Since then, they claim to have saved over 300,000 lives from death or serious bodily injury as a result of their products and aspire to cut gun-related deaths in half by 2033.
Since the launch of their taser, Axon have expanded into other products that help law enforcement, this includes the body cameras and fleet vehicle systems (police dashcams). They have reached such a scale where they now have a massive installed base of ‘sensors’ in the field and have been focused on layering on high-margin, recurring software revenues that now represent almost 50% of gross profit. Their most recent software offering is called DraftOne, which uses the vision captured by the Axon body camera to draft police reports, reducing a mundane task that consumes hours of an officer’s day. The Fort Collins Police Department has claimed a 67% decrease in time spent by officers writing incident reports since deploying the technology. Just 3 months after the launch, DraftOne had already amassed over $100m of revenue pipeline, the fastest product in Axon’s history to do so.
Today, Axon captures only 1% of US city budget spending. They are disrupting a largely under-served market yearning for products that make them better served to protect the public. We think they can continue to capture a greater portion of these budgets over time and see a multi-decade long runway for growth. They size their total addressable market at US$77bn relative to their revenue base of US$2bn today, and we are confident that Axon can continue to penetrate not only the market opportunities they have identified today, but also those that are yet to hear about this innovative company and its revolutionising technology.”
A technician in a white coat testing an in-car system on a modern military vehicle.
Axon Enterprise, Inc. (NASDAQ:AXON) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 46 hedge fund portfolios held Axon Enterprise, Inc. (NASDAQ:AXON) at the end of the third quarter which was 36 in the previous quarter. In the third quarter, Axon Enterprise, Inc.’s (NASDAQ:AXON) revenue grew 32% year-over-year and delivered strong adjusted EBITDA with a 26.7% margin. While we acknowledge the potential of Axon Enterprise, Inc. (NASDAQ:AXON) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article, we discussed Axon Enterprise, Inc. (NASDAQ:AXON) and shared Alger Mid Cap Focus Fund’s views on the company. In addition, please check out our hedge fund investor letters Q4 2024 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.