Sep. 22 at 2:57 PM
$KRKNF Scotiabank upped their target on the Taiwan news: "OUR TAKE: Positive. Shares of Kraken are up +8% today. We believe the move could be related to Taiwan’s signing of contracts with Anduril (Kraken’s largest customer) for underwater drone technology, specifically Dive-LD and Copperhead torpedoes. While there are no details on the value of the contracts, rising tensions in the Indo-Pacific are driving countries to increase their defense budgets in the coming years, which we think is a positive for Kraken. Recall that our battery estimates for Kraken mainly relate to the Ghost Shark (XL-UUV) program in Australia, leaving room for upside from Anduril’s other products (including the smaller variant Dive-LD model and Copperheads) and programs with other global navies. Given positive industry tailwinds related to defense tech and rising peer group multiples, our target moves to
$6 now reflecting 25.0x 2027 EV/EBITDA (prior 20.0x)"