TD Cowen’s top pick for the new year is a maker of law enforcement equipment, which the bank believes has the potential to rise almost 60% from current levels. CNBC Pro obtained a list of the top stocks distributed to clients by major Wall Street sell-side brokerages, including TD Cowen, and looked for stocks that analysts see as having the most upside potential. For TD Cowen, the stock with the best upside potential is Axon Enterprises. Axon Enterprises, a $45 billion company best known for its Taser electroshock weapon, is down 2% this year through Thursday. Axon’s stock price has plunged more than 30% from its August high. Axon’s stock price fell 26% in November alone after its third-quarter profit fell short of Wall Street expectations. The Scottsdale, Arizona-based company attributed the failure to the impact of increased tariffs. AXON YTD Mountain 2025 Axon Stock However, TD Cowen’s $925 price target suggests a potential upside of nearly 60% from Thursday’s closing price of $581.03. Analysts led by Andrew Sherman called Axon a “high-growth powerhouse” that currently sells at an attractive entry level. “We view the post-print pullback in Q3 as an overreaction,” he said. “We also see the stock trading at around 10x EV/CY27E sales (below the average mid-to-high 10s for most of this year) as a very attractive entry point.” “We think MGMT’s track record has earned a lot of credibility, and that should be evidenced by strong print in the fourth quarter.” Analysts at TD Cowen also cited Axon’s AI Era plan as one of the undervalued opportunities, adding that it was the company’s fastest-growing product in history, with $150 million in reservations in the second quarter alone. The plan, which provides AI-enhanced public safety tools, should account for 10% of U.S. state and local bookings this year, analysts said. Sherman also noted that Axon’s pricing power and addressable market penetration have also been underappreciated by investors, and that potential European sales offer an “accelerated” opportunity of $3.7 billion in 17 countries. TD Cowen told clients: “We anticipate a number of sustained growth drivers that should support very strong growth of $3 billion next year.” “We see strong momentum in both new markets and new products, and we believe we will see many years of sustainable growth.”
