The opening bell ceremony at the NASDAQ stock exchange in New York City today had special meaning for Taser International. For one thing, the starting bell was rung by Tom and Rick Smith, the company’s co-founders, and other members of the executive staff.
The chimes also symbolize a financial comeback for the company, which has faced a series of setbacks in the past few years.
“We’re really excited about the bell ringing,” said Tom Smith, as he and his brother prepared to leave for the Big Apple. “And we’re also excited about our recent successes.”
Taser International, the manufacturer of handheld stun guns used primarily by law enforcement and the military, was invited to the opening ceremony by NASDAQ primarily because of the firm’s financial progress, according to Steve Tuttle, vice president of communications.
Taser International reported a record $15.3 million in revenue in the first quarter of this year and is expected to announce steadily growing income in today’s second-quarter announcement.
The stock price has risen from a low of $6.50 a share to more than $16.
“The future looks good for Taser International,” said Joe Blankenship, analyst for the Source Capital Group. “The company has steadily defended itself, expanded its service to the military, law enforcement and foreign governments, and is improving its products.
“I don’t see a sudden dramatic surge of sales or earnings, but I foresee a respectable and steady increase in sales.”
Such has not always been the case for the company. The Smiths started the firm in 1999 and introduced the M26 stun gun, which fired two barbed darts attached to wires and delivered up to 1.3 watts of electrical current, temporarily immobilizing people.
“Our business was booming the first two years,” Smith said. “It increased after the terrorist attacks of 9/11 in 2001, and again in 2002 when the M26 was put inside airplane cockpits.”
The company introduced the X26 in May 2003, a smaller and lighter version and, Smith said, “our business took off like wildfire. However, 2004, 2005 and early 2006 became our years of just trying to survive.”
Those were the years when Taser International became the focus of criticism from several groups, including Amnesty International, for selling weapons alleged to be unsafe. Amnesty International reported that 156 people had died in the United States after being shocked by police Tasers, although they were billed as weapons that saved lives. The organization urged police departments to suspend using them pending more study.
In addition, Taser become the target of lawsuits filed by relatives of people who died after being stunned.
To complicate matters, Taser International was delisted by NASDAQ in November 2005 for failure to file its thirdquarter financial reports.
Shares plunged to a low of $6.50, down more than 80 percent from a record high of $33.45 at the end of 2004.
In January 2005, more than a dozen class-action lawsuits were filed in the U.S. District Court in Phoenix on behalf of Taser shareholders who claimed the company used false and misleading statements about the safety of its stun guns. The company eventually paid $20 million to settle with shareholders while not admitting fault.
More than 50 lawsuits filed against Taser International were dismissed by the courts. To date, the firm has not lost a product liability lawsuit, as the company produced studies that showed deaths were not caused by the stun gun but by the victims’ use of drugs, alcohol and other medications.
Nearly all law enforcement agencies in the Valley use Tasers, and the weapon is used by more than 10,000 police officers in the U.S. Taser products also are used in 44 countries.
On July 9, Taser unveiled two new products — the Shockwave, a device for the military that links six Tasers together and is designed to incapacitate multiple people within a 25-foot range, and XREP, a device fired from a shotgun that is capable of delivering shocks 100 feet away.
Earlier this year, the company offered a new stun gun, the C2, which is small enough to put in a purse and less powerful than the police version.