Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) Stock Now Rated "Moderate Buy" by Wall Street Brokerages

Key Points

• Wall Street maintains a positive outlook: Twenty-three brokerages give Kratos a consensus “Moderate Buy” rating, including 18 buys and two strong buys. The average 12-month price target is $98.06.
• Business momentum remains strong: Kratos reported quarterly revenue of $458.8 million, up 30.5% year over year, and EPS of $0.21 versus the $0.14 consensus estimate. Its successful ignition of a jointly developed GEK800 turbofan could support future drone and cruise-missile programs.
• Valuation and insider selling are key risks: Shares trade near $47, well below the 50-day and 200-day moving averages, while the stock carries a high P/E ratio of about 277. Insiders have sold roughly $24.6 million of stock over the past 90 days, though some transactions were made under pre-arranged trading plans.

Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS - Get Free Report) has been assigned an average recommendation of "Moderate Buy" from the twenty-three brokerages that are currently covering the company, MarketBeat reports. One analyst has rated the stock with a sell rating, two have assigned a hold rating, eighteen have given a buy rating and two have assigned a strong buy rating to the company. The average 1-year price objective among analysts that have covered the stock in the last year is $98.06.

KTOS has been the topic of several recent research reports. Cantor Fitzgerald decreased their target price on shares of Kratos Defense & Security Solutions from $115.00 to $100.00 and set an "overweight" rating on the stock in a research report on Tuesday, August 4th. Truist Financial reduced their price objective on Kratos Defense & Security Solutions from $135.00 to $104.00 and set a "buy" rating on the stock in a research note on Thursday, August 13th. Wedbush initiated coverage on Kratos Defense & Security Solutions in a research report on Tuesday, June 30th. They set an "outperform" rating and a $85.00 price objective on the stock. Guggenheim started coverage on Kratos Defense & Security Solutions in a research note on Monday, September 14th. They issued a "buy" rating and a $74.00 price objective for the company. Finally, BTIG Research raised their price objective on Kratos Defense & Security Solutions from $100.00 to $104.00 and gave the company a "buy" rating in a research note on Wednesday, August 5th.

Insider Activity at Kratos Defense & Security Solutions

In other Kratos Defense & Security Solutions news, Director Scot B. Jarvis sold 10,000 shares of the business's stock in a transaction on Tuesday, August 18th. The shares were sold at an average price of $63.50, for a total transaction of $635,000.00. Following the transaction, the director owned 65,123 shares in the company, valued at $4,135,310.50. The trade was a 13.31% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at this link. Also, insider Phillip Carrai sold 6,500 shares of the stock in a transaction on Tuesday, September 15th. The shares were sold at an average price of $47.83, for a total transaction of $310,895.00. Following the completion of the sale, the insider directly owned 175,653 shares in the company, valued at approximately $8,401,482.99. This represents a 3.57% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 396,188 shares of company stock worth $24,636,142 in the last ninety days. Corporate insiders own 1.50% of the company's stock.

Hedge Funds Weigh In On Kratos Defense & Security Solutions

A number of large investors have recently made changes to their positions in the company. Envestnet Portfolio Solutions Inc. raised its position in Kratos Defense & Security Solutions by 45.9% in the 2nd quarter. Envestnet Portfolio Solutions Inc. now owns 12,605 shares of the aerospace company's stock worth $628,000 after purchasing an additional 3,965 shares during the period. Sequoia Financial Advisors LLC boosted its position in shares of Kratos Defense & Security Solutions by 29.8% during the second quarter. Sequoia Financial Advisors LLC now owns 140,856 shares of the aerospace company's stock valued at $7,023,000 after buying an additional 32,315 shares during the period. Engineers Gate Manager LP boosted its position in shares of Kratos Defense & Security Solutions by 53.2% during the second quarter. Engineers Gate Manager LP now owns 6,885 shares of the aerospace company's stock valued at $343,000 after buying an additional 2,391 shares during the period. Integrated Wealth Concepts LLC bought a new position in shares of Kratos Defense & Security Solutions during the second quarter valued at approximately $119,000. Finally, IFP Advisors Inc grew its stake in shares of Kratos Defense & Security Solutions by 103.6% during the second quarter. IFP Advisors Inc now owns 7,422 shares of the aerospace company's stock valued at $370,000 after buying an additional 3,777 shares during the last quarter. 75.92% of the stock is owned by hedge funds and other institutional investors.

Kratos Defense & Security Solutions News Summary

Here are the key news stories impacting Kratos Defense & Security Solutions this week:

• Positive Sentiment: Kratos and GE Aerospace successfully ignited their jointly developed GEK800 turbofan engine on September 21. The milestone advances a potentially scalable, lower-cost propulsion system for drones and cruise missiles, supporting Kratos’ exposure to next-generation defense programs. Full Throttle: Kratos and GE Fire Up a Next-Gen Defense Engine
• Positive Sentiment: Growing concern about drone attacks on critical infrastructure is keeping attention on companies involved in drones, propulsion, and counter-drone systems. Kratos was included among defense stocks with revenue-growth potential. 3 Drone Defense Stocks With Revenue Growth Up To 44%
• Neutral Sentiment: Reports show the company’s CFO sold 7,000 shares for approximately $341,460 under a pre-arranged Rule 10b5-1 plan. Because the sale was scheduled in advance and the CFO still owns 273,511 shares, it is not necessarily a signal of deteriorating fundamentals. SEC insider transaction filing
• Neutral Sentiment: A short-interest update reports zero shares sold short and a zero-day days-to-cover ratio. That figure appears inconsistent with the description of a large increase in short interest, so it provides little dependable insight into current trading pressure.
• Negative Sentiment: The CFO’s sale may weigh on sentiment alongside reports of recent insider selling. KTOS also trades below its major moving averages and at an elevated valuation, leaving limited room for disappointing contract wins, growth, or profitability.

Kratos Defense & Security Solutions Trading Up 1.9%

KTOS stock opened at $47.02 on Friday. The firm has a fifty day moving average price of $51.64 and a 200 day moving average price of $59.31. Kratos Defense & Security Solutions has a fifty-two week low of $43.09 and a fifty-two week high of $134.00. The firm has a market cap of $8.83 billion, a PE ratio of 276.59 and a beta of 1.11. The company has a debt-to-equity ratio of 0.04, a quick ratio of 4.99 and a current ratio of 5.54.

Kratos Defense & Security Solutions (NASDAQ:KTOS - Get Free Report) last released its quarterly earnings results on Tuesday, August 4th. The aerospace company reported $0.21 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.14 by $0.07. Kratos Defense & Security Solutions had a net margin of 2.03% and a return on equity of 3.07%. The company had revenue of $458.80 million for the quarter, compared to the consensus estimate of $410.36 million. During the same quarter in the prior year, the firm earned $0.11 earnings per share. Kratos Defense & Security Solutions's revenue was up 30.5% on a year-over-year basis. Sell-side analysts anticipate that Kratos Defense & Security Solutions will post 0.57 earnings per share for the current fiscal year.

Kratos Defense & Security Solutions Company Profile

Kratos Defense & Security Solutions, Inc is a technology company that develops products and systems for national security, defense and commercial applications. The company primarily serves the U.S. Department of Defense and other government agencies, while also supporting allied governments and selected commercial customers.

Its offerings include unmanned aerial and ground systems, target drones, tactical drones, satellite communications systems, space-related products, missile defense technology, hypersonic and high-speed systems, radar and command-and-control solutions, and microwave electronics.

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