Kratos Defense & Security Solutions (NASDAQ:KTOS) Shares Down 1.1% - Should You Sell?

Key Points

• Wall Street view: Analysts are largely bullish with a consensus rating of "Moderate Buy" and a consensus price target of $98.28, with several firms raising targets (KeyCorp to $130, Canaccord to $125).
• Quarterly results: Kratos reported an EPS beat ($0.18 vs. $0.14) and revenue of $345.1M (up 21.9% YoY and above estimates), but the stock carries a very high P/E (~643.8) on a $15.6B market cap.
• Insider activity & trading: Insiders have sold heavily recently (371,500 shares worth $34.66M in the last 90 days) while the stock was down ~1.1% intraday with below-average volume, which may concern some investors.

Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS - Get Free Report) fell 1.1% on Monday . The stock traded as low as $82.07 and last traded at $83.69. 3,179,210 shares traded hands during trading, a decline of 28% from the average session volume of 4,405,034 shares. The stock had previously closed at $84.62.

Wall Street Analysts Forecast Growth

A number of equities analysts have issued reports on KTOS shares. KeyCorp upped their target price on Kratos Defense & Security Solutions from $90.00 to $130.00 and gave the stock an "overweight" rating in a report on Wednesday, January 28th. Weiss Ratings restated a "hold (c)" rating on shares of Kratos Defense & Security Solutions in a report on Thursday, January 22nd. Citizens Jmp upped their price objective on Kratos Defense & Security Solutions from $105.00 to $125.00 and gave the company a "market outperform" rating in a research note on Monday, January 12th. Canaccord Genuity Group lifted their target price on shares of Kratos Defense & Security Solutions from $120.00 to $125.00 and gave the stock a "buy" rating in a research report on Tuesday, February 24th. Finally, JonesTrading started coverage on shares of Kratos Defense & Security Solutions in a report on Monday, January 5th. They set a "buy" rating on the stock. One analyst has rated the stock with a Strong Buy rating, fifteen have assigned a Buy rating and six have assigned a Hold rating to the company. According to MarketBeat, the stock currently has a consensus rating of "Moderate Buy" and a consensus price target of $98.28.

Kratos Defense & Security Solutions Price Performance

The stock has a market cap of $15.63 billion, a P/E ratio of 643.82 and a beta of 1.12. The business has a 50-day simple moving average of $99.48 and a 200 day simple moving average of $87.71. The company has a current ratio of 4.06, a quick ratio of 3.46 and a debt-to-equity ratio of 0.05.

Kratos Defense & Security Solutions (NASDAQ:KTOS - Get Free Report) last issued its quarterly earnings data on Monday, February 23rd. The aerospace company reported $0.18 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $0.14 by $0.04. The company had revenue of $345.10 million during the quarter, compared to the consensus estimate of $327.51 million. Kratos Defense & Security Solutions had a return on equity of 3.34% and a net margin of 1.63%.The firm's revenue was up 21.9% compared to the same quarter last year. During the same period last year, the company earned $0.13 earnings per share. On average, analysts forecast that Kratos Defense & Security Solutions, Inc. will post 0.31 earnings per share for the current year.

Insider Buying and Selling

In other news, SVP Marie Mendoza sold 1,516 shares of the stock in a transaction on Monday, March 16th. The shares were sold at an average price of $88.97, for a total transaction of $134,878.52. Following the completion of the sale, the senior vice president directly owned 67,926 shares in the company, valued at $6,043,376.22. This represents a 2.18% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available through the SEC website. Also, VP De Burgreen Maria Cervantes sold 6,270 shares of Kratos Defense & Security Solutions stock in a transaction on Monday, March 16th. The stock was sold at an average price of $89.29, for a total transaction of $559,848.30. Following the transaction, the vice president directly owned 59,369 shares of the company's stock, valued at $5,301,058.01. This represents a 9.55% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. In the last 90 days, insiders sold 371,500 shares of company stock worth $34,664,848. Corporate insiders own 2.37% of the company's stock.

Institutional Inflows and Outflows

Several hedge funds have recently made changes to their positions in KTOS. Mcguire Capital Advisors Inc. bought a new position in shares of Kratos Defense & Security Solutions in the 4th quarter worth $25,000. Bayforest Capital Ltd acquired a new position in Kratos Defense & Security Solutions during the third quarter worth $32,000. Caitlin John LLC bought a new position in shares of Kratos Defense & Security Solutions in the third quarter valued at $32,000. Atlantic Union Bankshares Corp grew its holdings in shares of Kratos Defense & Security Solutions by 7,600.0% during the fourth quarter. Atlantic Union Bankshares Corp now owns 385 shares of the aerospace company's stock valued at $29,000 after buying an additional 380 shares during the last quarter. Finally, Whittier Trust Co. acquired a new stake in shares of Kratos Defense & Security Solutions in the 3rd quarter worth about $38,000. 75.92% of the stock is owned by institutional investors.

Kratos Defense & Security Solutions Company Profile

Kratos Defense & Security Solutions, Inc NASDAQ: KTOS is a technology-driven company that specializes in national security and defense solutions for government and military customers. The firm’s core capabilities span unmanned systems, satellite communications, missile defense, cyber security, and directed-energy weapons. Through its integrated approach, Kratos delivers mission-critical products and services designed to enhance operational readiness and support force modernization initiatives.

In the unmanned systems arena, Kratos develops high-performance aerial platforms used as target drones, low-cost attritable aircraft and experimental stealth demonstrators.

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