UPDATE 1-Taser gets Texas contract; shares rise

* Expects orders to ship in Q3

* Shares rise as much as 5 pct

Sept 1 (Reuters) - Taser International Inc (TASR.O) said it received an order from a Texas homeland security agency for its stun-guns and related accessories, sending its shares up 5 percent.

The company said the order from the Texas Department of Public Safety is expected to ship in the third quarter.

Merriman Curhan Ford analyst Eric Wold said the order would likely add about $2.7 million to the company's third-quarter revenue. Analysts are expecting total revenue of $23.02 million for the period.

Taser reported a wider second-quarter loss in July, hurt by a delay in completion of large international orders and cutbacks in domestic local budgets.

The company had said it expected one or two of the orders to be shipped in the second half of 2010, with one of them potentially representing the company's largest order in history.

"Should one of those orders be announced within the third quarter, we believe it could push results above expectations -- otherwise still providing some visibility into fourth-quarter results," said Wold, who has a "neutral" rating on the stock.

Taser saw demand falling in most of its key markets this year as security agencies initiated cost-control drive, including drastic cuts in equipment budgets.

The Scottsdale, Arizona-based company's shares shed more than half of their value since touching a year-high of $7.88 in February.

"With Taser still considered a nice-to-have instead of a need-to-have by most budget-setters, we continue to be cautious on the near-term domestic outlook for the company's products," the analyst said.

The company's guns are bought not only by the police, military and correction facilities, but also by individuals and casinos and have been a lightening rod for criticism because of possible injury hazards.

Taser is currently working on brands such as Protector -- an application that gives parents the ability to supervise their children's mobile phone usage and monitor driving behavior.

Taser shares were up 4 percent at $3.79 in morning trade on Nasdaq. They rose to a high of $3.87 earlier in the session. (Reporting by Bijoy Koyitty in Bangalore; Editing by Maju Samuel)