Q: Kraken has been in a tear in the last week. Is it out over its skis or does it have a lot of room to still grow?
Appreciate your insight.
Paul F.
Appreciate your insight.
Paul F.
5i Research Answer:
We have comments posted on PNG here, and while it trades at a high valuation of 126X forward earnings, analyst estimates for forward growth continues to trend higher. We like its revenue shift into more service-based sales, as this can expand its profit margins, and it operates in an industry with secular growth tailwinds. We think it has further room to grow, but there is headline risks as it trades at an expensive valuation, and pullbacks/consolidation is likely.