Weapons…
Plenty of People love them.
Plenty of People hate them.
Rising up in rural North Carolina, they had been simply part of our lives.
My father had shotguns and rifles throughout his workplace. Up excessive, out of the attain of youngsters, in fact.
Youngsters would present as much as college with them hanging within the again window of their pickup vehicles (that was discouraged as we entered the ‘90s).
My sixth grade Christmas reward was a online game and … a 20-gauge shotgun. Searching with shotguns and rifles was simply part of nation livin’.
Regardless of rising up with weapons, I by no means held a handgun till I used to be 28.
I bear in mind it properly.
It was a distinct feeling.
The handgun was designed to kill or hurt an individual. To not put meals on the household desk.
I felt uncomfortable simply holding it.
As I aimed it on the black silhouette of a person, it made me consider what a police officer may really feel as he aimed it at a dwell human being.
There’s a whole lot of weight, and accountability, with a handgun. Pulling the set off put one other’s life in a single’s fingers, and would usually create large regret for any officer utilizing a gun within the line of responsibility.
Across the yr 2000, law enforcement officials began carrying one other weapon … the Taser.
A Taser is way safer.
As a substitute of sending a bullet by way of an individual, the gun sends 50,000 volts of electrical energy by way of an individual, gorgeous them.
We’ve all seen the movies of individuals falling down, shaking violently, into submission.
In the present day, an estimated 94% of police departments have Tasers.
Because of this Taser maker, Axon Enterprises (Nasdaq: AXON), hauls in $1.2 billion yearly.
And it’s why shares of Axon have gone from $5 a share in 2015, to $250 a share right this moment.
That’s a achieve of 5,000%.
I missed out on these positive factors, and you could have as properly, however … we’ve got a second probability at them.
Right here’s why. Taser has an issue. They’re much more lethal than marketed.
A Taser consumer is, in spite of everything, surprising folks with 50,000 volts of electrical energy.
Reuters counted greater than 1,000 deaths up to now, and they’re climbing quickly.
Ninety % of those folks had been unarmed.
There are horror tales of pregnant ladies, minorities and simply abnormal site visitors violations turned lethal for nearly no motive, as a result of misuse of Tasers.
(Right here’s the loopy half: One other examine discovered that gun deaths by police haven’t declined, regardless of widespread Taser adoption.)
In the meantime, lawsuits are piling up in cities across the nation, a few of them ending in multimillion-dollar settlements.
That features a $6.5 million verdict towards a cop who tased a excessive schooler and dropped him face down on the pavement.
Some big-city police departments just like the LAPD are even seeing $100 million lawsuits being filed for Taser-related deaths.
With lawsuits impacting each police departments and particular person law enforcement officials, these payouts merely aren’t sustainable.
Plus, the paperwork alone is so overwhelming cops are considering twice about even carrying them.
Cities are additionally pissed off by the price of shopping for the gadgets, which may go as much as $1,500 every for higher-end fashions. They argued in courtroom that Axon is utilizing its monopoly to run up costs.
Lengthy-term contracts run into hundreds of thousands of {dollars}, with large cities like Baltimore paying Axon over $1 million yearly.
Backside line, Tasers are far too expensive, when it comes to {dollars}, paperwork, litigation and, most significantly, lack of life.
Now, there may be another …
And this various may result in one other 5,000% alternative for buyers.
Check out this machine…
It seems to be a bit like a stud finder…
However it’s really a nonlethal weapon that may incapacitate with out a harmful electrical shock.
The product is named BolaWrap.
You’ve most likely seen footage of primitive hunters utilizing a rope with weights on both finish, referred to as a bola. Hunters would throw it at prey to wrap up their legs.
The BolaWrap is similar concept, modernized.
Simply intention, pull the set off, and two ropes shoot out with small hooks on the tip … wrapping an individual up.
It does almost no hurt. A possible prick, at worst.
Targets are immobilized. Once more, with out an electrical shock. And the implications of being shocked and knocked to the bottom.
Cops appear to like the brand new machine.
“Now we’ve got a device to make use of to de-escalate issues very quickly,” says Glenwood Springs, Colorado, police Chief Joseph Deras.
“As we attempt to discover new and revolutionary methods to do our jobs extra successfully and extra humanely, this turned a really engaging machine for us,” says Franklin County, Vermont, Sheriff John Grismore.
“Cops have to make use of pressure, it’s an inevitable actuality of what we do … However this provides us a device to make use of a a lot, a lot lesser degree of pressure, and hopefully, the flexibility to deescalate that state of affairs earlier than extra pressure is required,” he mentioned.
Adoption is accelerating quickly.
Greater than 1,000 police departments across the U.S. are already utilizing it. Insiders count on the opposite 17,000 legislation enforcement businesses will probably be fast to leap on board.
Briefly, the BolaWrap is the brand new, genuinely nonlethal device on the town. And it may seize a giant chunk of Taser’s market share.
The corporate behind this new machine is Wrap Applied sciences (Nasdaq: WRAP).
Since going public in 2018, annual gross sales have risen from a mere $23,000 to $10 million. Any time I see income progress like this, I lean in…
Full-year 2023 knowledge isn’t posted but, however it will likely be over $10 million, primarily based on the final three quarters and a latest $5 million order.
But, regardless of this income progress … WRAP trades at simply $3 a share. That’s decrease than its IPO value!
Which is simply one of many the reason why I’ve invested in WRAP, and assume you need to take into account investing as properly.
It might be the subsequent 5,000% winner.
To place the chance in perspective, take into account this.
Whereas WRAP’s income progress seems to be sturdy at $10 million, it’s TINY in comparison with Axon’s annual income of $1.2 billion.
Simply assume … if Wrap can achieve simply 10% of the market share from Axon … we’re speaking about an annual income stream of $120 million. That’s a 1,000% leap from the place it’s at now.
At that $3 inventory may doubtlessly shoot as much as $30 a share.
However I feel the chance might be even greater.
There are the reason why…
First, worldwide orders.
Taser weapons had been by no means adopted at a big degree internationally. Apparently, foreigners should not too enthusiastic about surprising folks with 50,000 volts of electrical energy.
It is a large alternative for Wrap. Gross sales overseas, in Europe, South America and the Center East, grew 940% during the last yr. And so they’re nonetheless a minuscule a part of the market.
The long-term potential right here is huge. Wrap can dominate the worldwide market with out competitors from Axon.
Secondly, Wrap is moving into the physique digicam market.
Police physique cams at the moment are frequent for almost each officer.
Activists prefer it as a result of it protects civilians.
Cops like them as a result of now folks can see the complete dialog … not simply the edited recording of an intense struggle.
A couple of months in the past, Wrap acquired Intrensic, an organization that makes the cameras law enforcement officials use and shops the information.
So, Wrap will earn a living promoting the cameras.
However, extra profitable, is the storage of the information.
WRAP sells an internet knowledge platform that helps police acquire and handle crime scene proof.
That will probably be an enormous time-saver for legislation enforcement and a cash printer for WRAP.
Police might solely purchase BolaWrap gadgets as soon as. However they might subscribe to digital proof storage constantly.
Corporations that may develop streams of recurring income are inclined to get the market’s consideration in time.
The third motive I like Wrap is the administration.
Apart from the good product it’s developed and its methodical method to speedy progress, during the last yr, it’s loaded up on shares.
CEO Kevin Mullins simply acquired 246,000 shares.
And Govt Chairman Scot Cohen simply acquired 5.5 million shares.
Keep in mind, firm insiders have loads of causes to promote shares. They could have to diversify. They could have to pay payments. They could need to lastly purchase a ship and reward themselves for years of arduous work.
However they purchase for just one motive: They see shares as undervalued. And insiders already personal 33% of the corporate. Additional buys right here look extremely bullish.
Backside line: At $3 a share, WRAP is a good value.
The corporate is tiny … valued at solely $125 million.
Evaluate that to Axon, sitting at $18 billion.
It’s straightforward to see how shares of Wrap may transfer 10X increased from right here. Perhaps even 50X increased.
The story isn’t out but. And Wrap’s market share is minuscule. Even grabbing 20% to 25% of the market, which I feel is achievable within the subsequent 5 to seven years, may make this firm a runaway winner.
That’s why I see this as a 50-bagger — able to 5,000% positive factors.
At its present market cap, that might imply Wrap will get a valuation of $6.3 billion. That’s nonetheless a couple of third the scale of Axon. So, sure, that’s a practical return within the years forward.
To be clear: Wrap is a high-risk, high-reward funding. The inventory value will probably be risky.
However it’s a chance I see as too good to move up.
Once more, I personal shares of this firm, and I plan to reap the reward on it for years to return.
I like this firm and what it’s doing to scale back casualties in police encounters. And its new applied sciences, just like the physique cam, will take the inventory to that subsequent degree.
Which is why WRAP is my high inventory choose for 2024.
By the best way: For those who resolve to take a position alongside me, shoot me an e-mail at AaronJames@BanyanHill.com. Let me know the way a lot you determined to take a position!
Aaron James
CEO, Banyan Hill Publishing and Cash & Markets
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