Rising long term US and European bond yields are putting a higher price on labor and capital. This makes every extra unit of productivity more valuable. That is where the robotics and automation stocks in this screener come in. They sit at the heart of the physical AI shift that aims to do more with fewer workers. This article highlights three standout robotics stocks from the screener.

The three robotics and automation stocks below are just a starting sample, since the full screen surfaced 34 more companies with equally compelling narratives that are not covered here. To identify and analyze the highest conviction automation plays for your watchlist, head straight into the Robotics and Automation Stocks screener.

Kraken Robotics (TSXV:PNG)

Kraken Robotics is a marine technology company that supplies sonar and optical sensors, subsea batteries and underwater robotic systems used in military and commercial projects worldwide. It generated about CA$66 million from product sales and CA$41 million from services, reflecting a mix of hardware and recurring survey and inspection work. The company is currently valued at around CA$1.9b.

Investors watching the physical AI trend may want to keep Kraken Robotics on their radar. The company is tied directly to rising use of unmanned underwater vehicles in defense and offshore energy, with fresh orders, the recent Covelya acquisition and new SeaPower battery capacity giving it additional ways to compete for contracts. At the same time, Kraken is still loss making, has taken on sizeable new debt to fund deals and has seen insider selling, so execution on integration and demand for batteries and survey work will be important from here. The upcoming earnings and guidance updates will help investors judge whether this growth story is staying on track or stretching too far, too fast.

Kraken Robotics sits at the center of physical AI in the ocean, yet the real story may be how its balance sheet and funding choices shape that potential. Before adding it to a watchlist, investors will likely want to consider the fresh debt load, cash position, and funding runway in the Kraken Robotics financial health report via the Kraken Robotics financial health report

Build your own robotics and physical AI shortlist

Kraken Robotics and the other two stocks in this piece all came from a single screener, but the real advantage is setting filters that match your own checklist. Use our flexible Screener to mix valuation, growth, balance sheet and risk metrics, or lean on our curated Investing Ideas if you prefer ready made shortlists.

AXT (AXTI)

AXT sits behind much of the hardware that powers AI, data centers and high speed connectivity, supplying compound semiconductor substrates used in lasers, sensors and advanced optics. It generated about US$126 million from semiconductor equipment and services and the stock is valued at around US$5.0b.

AXT gives you exposure to the picks and shovels of AI infrastructure, with record indium phosphide revenue, new long term supply deals with customers like Lumentum and plans to scale capacity again in 2027 in response to demand for faster optical links. The company has only recently turned profitable and still faces low margins, export permit uncertainty and heavy reliance on Chinese customers, so today’s valuation leaves little room for disappointment. For investors who can tolerate sharp share price swings and regulatory risk, the mix of AI focused operations and improving earnings quality may justify a closer look at whether the potential reward outweighs those pressure points.

AXT’s AI substrate story is accelerating; however, the real twist is how much risk is already baked into today’s US$5.0b price tag. Get the full context in the 2 key rewards and 3 important warning signs (2 are major!)

Arm Holdings (ARM)

Arm Holdings designs the CPU and related chip architectures that sit inside everything from smartphones and cars to cloud servers and AI data centers, earning licensing fees and ongoing royalties on each Arm based chip. The company generated about US$5.2b from semiconductor equipment and services and has a market value of roughly US$297.6b. That puts Arm in the top tier of global semiconductor IP players by size.

Arm Holdings is on many investors’ watchlists because it sits at the center of the AI compute build out, with high margin licensing and royalty revenue, earnings growth of 49.4% over the past year and a fast growing AI data center CPU franchise that has more than US$2b of expected demand through fiscal 2027 and 2028. The catch is that the stock already reflects very optimistic expectations, trades at rich valuation multiples and is under regulatory scrutiny for how it uses its IP position. The real question is whether Arm’s AGI CPU ramp and royalty growth can keep justifying that premium.

Arm’s AI royalty engine is accelerating, yet many investors still treat it like a simple smartphone story. Get the full context in the analyst forecasts for Arm Holdings that reveals what might be hiding behind those expectations.

Curious To See What You’re Missing?

Fresh stock ideas can move from quiet buildup to full breakout before most investors notice. Catch momentum while it is still under the radar for now, act now.

• Target dependable cash flow and income strength with a curated 4 dividend fortresses that have the balance sheets to keep paying when others are cutting.
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• Zero in on quality first by filtering a list of solid balance sheet and fundamentals (12 results) so you are focusing on companies built to handle shocks, not just chase headlines.

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.