Assessing Kraken Robotics (TSXV:PNG) Valuation After New CA$35 Million Battery Orders And Contract Momentum

Kraken Robotics (TSXV:PNG) is back in focus after announcing $35 million in new SeaPower battery orders from three customers, along with continued contract activity in defense and commercial survey markets that is drawing fresh investor attention.

See our latest analysis for Kraken Robotics.

These new SeaPower orders arrive at a time when momentum in the shares has been strong, with a 30 day share price return of 38.82% and a 1 year total shareholder return of 216.00%. This suggests sentiment has been building around Kraken Robotics’ contract wins and execution story rather than fading.

If this kind of contract driven move has your attention, it could be a good moment to see what else is happening across high growth tech and AI stocks as another source of potential ideas.

With the shares up 216.00% over 1 year and trading above the CA$7.50 analyst price target at CA$8.69, the key question now is whether Kraken Robotics is still undervalued or if the market is already pricing in future growth.

Preferred Price-to-Sales Multiple of 26.2x: Is It Justified?

On the numbers, Kraken Robotics currently trades on a P/S of 26.2x, which is well above both its peer group and where our fair ratio work suggests it could sit.

The P/S multiple compares the company’s market value to its revenue, so a higher ratio usually reflects strong expectations around future sales growth, margins, or both. For Kraken Robotics, forecasts point to revenue growing at 27% per year and earnings at 55.1% per year. This helps explain why investors may be willing to pay a higher price for each dollar of current sales.

Even so, the gap is wide. The North American Electronic industry average sits at 3x, and Kraken Robotics is also flagged as expensive versus an estimated fair P/S ratio of 6.4x. That is a sharp premium. It highlights how far sentiment has moved beyond more typical sector levels and the level our fair ratio work suggests the market could gravitate toward over time.

Explore the SWS fair ratio for Kraken Robotics

Result: Price-to-sales of 26.2x (OVERVALUED)

However, sentiment this strong can cut both ways, especially if future contract awards slow or if margins from newer products like SeaPower do not match expectations.

Find out about the key risks to this Kraken Robotics narrative.

Another View Using Our DCF Model

While the P/S ratio hints at a rich price, our DCF model also points to a full valuation, with Kraken Robotics at CA$8.69 versus an estimated future cash flow value of CA$6.99. If both methods indicate that the stock is expensive, the question is what kind of execution would need to show up next.

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Kraken Robotics for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 881 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match – so you never miss a potential opportunity.

Build Your Own Kraken Robotics Narrative

If you see the data differently or prefer to test your own assumptions, you can build a customised view in just a few minutes by starting with Do it your way.

A great starting point for your Kraken Robotics research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data
and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your
financial situation. We aim to bring you long-term focused analysis driven by fundamental data.
Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
Simply Wall St has no position in any stocks mentioned.

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