Velan Inc.

TSX:VLN Stock Report

Market Cap: CA$250.6m

Velan Valuation

Is VLN undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Sales vs Peers

  • Price-To-Sales vs Industry

  • Price-To-Sales vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of VLN when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: VLN (CA$11.61) is trading below our estimate of fair value (CA$307.23)

Significantly Below Fair Value: VLN is trading below fair value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for VLN?

Key metric: As VLN is unprofitable we use its Price-To-Sales Ratio for relative valuation analysis.

The above table shows the Price to Sales ratio for VLN. This is calculated by dividing VLN's market cap by their current revenue.
What is VLN's PS Ratio?
PS Ratio0.5x
SalesUS$374.99m
Market CapUS$179.29m

Price to Sales Ratio vs Peers

How does VLN's PS Ratio compare to its peers?

The above table shows the PS ratio for VLN vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PSEstimated GrowthMarket Cap
Peer Average4.5x
SHRC Sharc International Systems
14.5xn/aCA$30.1m
SIS Savaria
1.9x7.1%CA$1.6b
TMG Thermal Energy International
1.2x28.2%CA$34.5m
REKO Reko International Group
0.4xn/aCA$16.7m
VLN Velan
0.5xn/aCA$250.6m

Price-To-Sales vs Peers: VLN is good value based on its Price-To-Sales Ratio (0.5x) compared to the peer average (4.5x).

Price to Sales Ratio vs Industry

How does VLN's PS Ratio compare vs other companies in the CA Machinery Industry?

6 CompaniesPrice / SalesEstimated GrowthMarket Cap
WPRT Westport Fuel Systems
0.2x6.1%US$76.44m
BUI Buhler Industries
0.3xn/aUS$51.51m
LEV Lion Electric
0.3x29.4%US$46.85m
VMC Vicinity Motor
0.09xn/aUS$2.53m
VLN 0.5xIndustry Avg. 1.0xNo. of Companies7PS01.22.43.64.86+
6 CompaniesEstimated GrowthMarket Cap
No more companies

Price-To-Sales vs Industry: VLN is good value based on its Price-To-Sales Ratio (0.5x) compared to the Canadian Machinery industry average (1x).

Price to Sales Ratio vs Fair Ratio

What is VLN's PS Ratio compared to its Fair PS Ratio? This is the expected PS Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

VLN PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio0.5x
Fair PS Ration/a

Price-To-Sales vs Fair Ratio: Insufficient data to calculate VLN's Price-To-Sales Fair Ratio for valuation analysis.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Insufficient data to show price forecast.

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