Kraken Robotics Inc V.PNG

Surprise, Suprise, Kraken Robotics Didn't Learn Their Lesson

[NLMoose]

Looks like Kraken Robotics investors are now paying the price for the company not learning their lesson in getting more and more Private Placements.

While I can support their decision to get more debt financing as debt is cheaper than equity as the "after tax cost of new debt" is factored into Required Rate of Return (Weighted Average Cost of Capital) calculations, I don't support their move to get more Private Placements.

Due to these Private Placements, Kraken Robotics shares will never reached its optimal TD Investments defined share price of $1.60 a share, and its now plummeting to 97 cents a share.

What have you done to the investors Kraken Robotics in not learning your lessons?

[Torontojay]

Hi Moose, I did a write up not long ago comparing the US companies in the aerospace/defence with Kraken and I found that Kraken is relatively undervalued by at least 30%. However, the industry itself may be considered overvalued so one cannot simply look at relative valuation alone.  If the company chooses debt over equity and grows cash flows at a rate higher than its weight average cost