Aaron Bush

July 10, 2014

TASER International(NasdaqGS: TASR)

The Business• Police Departments

• Militaries

• Self Defense

• New Categories• Axon Cameras• Evidence.com

RB Sell Recommendation

“Recent court rulings have shown more favor for plaintiffs, and any case that draws a straight line between Taser and serious injury or death would cripple

sales -- and possibly the company.

But the central issue is money, and to make it, Taser is dependent on government buying. Growth investing pioneer Philip Fisher warned against

such situations, and this inconsistent stream of revenue isn't enough to compensate for the legal risk. We recommend selling Taser.”

The Breakdown:

68.1

28.2

3.72011

Weapons Cartidges Evidence.com & Video

66.4

28.6

52012

Weapons Cartidges

Evidence.com & Video

66.6

25.9

7.52013

Weapons Cartidges

Evidence.com & Video

By CategoryBy Location

80

20

2011

Domestic International

81

19

2012

Domestic International

84

16

2013

Domestic International

•Dominant market leader

• Innovative culture

• Strong patent protection

• Important connections

Competitive Advantages

Does more good than you think!

• Significant upgrade opportunity

• Largely untapped international markets

• AXON-Evidence.com• SaaS, recurring revenue

• Strong balance sheet

• Strong IP, brand, and customer relationships

• Share repurchases• 24% of shares outstanding bought back since 1/1/2011

Investment Drivers

Miscellaneous (Rapid Fire)

1 2 3 4 5

-10%

-5%

0%

5%

10%

15%

-20

0

20

40

60

80

100

120

140

160

Growth & Profi tability

Rev Net income Profit Margin

1 2 3 4 5

-10%

-5%

0%

5%

10%

15%

20%

ROE

1 2 3 4 5

-10%

-5%

0%

5%

10%

15%

20%

25%

FCF/Revenue

1 2 3 4 50

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

Inventory Turnover

1 2 3 4 50

20

40

60

80

100

120

140

160

180

CCC

• Technological disruption

•New products may underperform

•Upgrade rate may decelerate

• International attempts may flop

•Regulations may restrain growth

Risks

• Taser remains the dominant, innovative market leader

• The Taser of the future is not the Taser of yesterday

• New technologies are rapidly catching on

• There are still hurdles to overcome

• Valuation: $2.3 billion (+300% ± a lot)

In Conclusion