I bought TASR calls for $2.65/contract on 7/26. The price of the stock was approximately $7.30 which puts intrinsic value of the option at $2.30 and about a .35 time premium for 5 months. The premium seemed low and TASR is a volatile and fundamentally attractive stock.
If you haven’t heard of Taser, I’ll give you a quick intro. They manufacture the high-voltage stun guns in use by consumers, police, and government. As an alternative to using a gun, I have to say I believe in the product whole heartedly. There has been a lot of bad press about wrongful death suits where people have died after being stunned. I cannot comment on the individual cases, but I have to rely on the fact that if the officer felt threatened enough to use the stun gun, they may have very likely used a regular gun instead.
Police departments all over the country have been purchasing and evaluating the stun guns. Orders continue to roll in and the company has some interesting concepts for future use of their technologies.
on Oct 26th, 2006 at 4:50 am
TASR announced earnings today and beat estimates by a penny. Net income was reported at $2.4 million, 4 cents per share up from 1 cent per share last year. Sales went from $11.7 million last year to $18.3 million. There is still buzz about an LAPD contract, French government contract, and various military contracts.
This stock makes me a tad nervous as they run a goofy PR campaign, releasing PR docs a couple times a week regarding stories about their Taser devices such as “Police Department’s First Use of TASER Device Ends Suicide Attempt”, “TASER Device Ends Attempted Suicide”, and “TASER Device Ends Child Hostage Situation”. It seems a bit over done but, the bottom line is, they are getting their product into the hands of a lot of officers and, I believe, they are a much safer way of dealing with volatile situations. Yes, people have died after being stunned, but the better question to ask is how many lives have been saved by using a Taser instead of a gun.
The company seems to be moving forward, full steam ahead. They settled all of their outstanding lawsuits a month or so back, agreeing on a one time payment that they could easily pay with cash on hand. This seemed like a very bright move as it reduced their exposure to future liability on these claims and freed up their resources to focus on sales/development/PR instead of fighting out the battles in court.