Kratos Defense & Security Solutions (NASDAQ:KTOS) Shares Down 5.8% - Should You Sell?

Key Points

• KTOS shares fell 5.8% in mid-day trading, dropping to around $51.09 after closing at $54.21 the prior session, with volume running above average.
• Despite the pullback, analyst sentiment remains broadly positive: the stock carries a “Moderate Buy” rating and an average price target of $101.35, though several firms recently trimmed their targets.
• Kratos beat first-quarter earnings and revenue expectations, reporting $0.16 EPS on $371 million in revenue, while insider selling has also been notable in recent months.

Shares of Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS - Get Free Report) were down 5.8% during mid-day trading on Monday . The stock traded as low as $50.68 and last traded at $51.09. Approximately 4,645,933 shares changed hands during mid-day trading, an increase of 7% from the average session volume of 4,360,843 shares. The stock had previously closed at $54.21.

Wall Street Analyst Weigh In

A number of research analysts have issued reports on KTOS shares. Piper Sandler decreased their target price on Kratos Defense & Security Solutions from $99.00 to $75.00 and set a "neutral" rating for the company in a research note on Thursday, May 7th. Canaccord Genuity Group lifted their price objective on Kratos Defense & Security Solutions from $125.00 to $130.00 and gave the company a "buy" rating in a report on Thursday, May 7th. Citigroup reiterated a "market outperform" rating on shares of Kratos Defense & Security Solutions in a research report on Tuesday, February 24th. UBS Group reissued a "neutral" rating and set a $82.00 target price on shares of Kratos Defense & Security Solutions in a research note on Thursday, May 7th. Finally, Royal Bank Of Canada dropped their target price on shares of Kratos Defense & Security Solutions from $100.00 to $80.00 and set an "outperform" rating on the stock in a report on Thursday, May 7th. Three investment analysts have rated the stock with a Strong Buy rating, sixteen have assigned a Buy rating and four have issued a Hold rating to the company. According to data from MarketBeat.com, the stock currently has an average rating of "Moderate Buy" and an average price target of $101.35.

Kratos Defense & Security Solutions Stock Performance

The stock has a fifty day simple moving average of $60.82 and a 200-day simple moving average of $79.48. The stock has a market cap of $9.58 billion, a P/E ratio of 300.53 and a beta of 1.04. The company has a debt-to-equity ratio of 0.04, a quick ratio of 5.08 and a current ratio of 5.63.

Kratos Defense & Security Solutions (NASDAQ:KTOS - Get Free Report) last issued its quarterly earnings results on Wednesday, May 6th. The aerospace company reported $0.16 EPS for the quarter, beating analysts' consensus estimates of $0.13 by $0.03. The company had revenue of $371.00 million for the quarter, compared to analyst estimates of $345.00 million. Kratos Defense & Security Solutions had a return on equity of 2.82% and a net margin of 2.08%.The company's quarterly revenue was up 22.6% compared to the same quarter last year. During the same period in the previous year, the company posted $0.12 earnings per share. On average, equities analysts expect that Kratos Defense & Security Solutions, Inc. will post 0.47 earnings per share for the current year.

Insider Transactions at Kratos Defense & Security Solutions

In other news, CFO Deanna H. Lund sold 5,000 shares of Kratos Defense & Security Solutions stock in a transaction that occurred on Monday, June 1st. The shares were sold at an average price of $63.74, for a total value of $318,700.00. Following the sale, the chief financial officer directly owned 290,161 shares in the company, valued at $18,494,862.14. This trade represents a 1.69% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider David M. Carter sold 4,000 shares of the business's stock in a transaction on Friday, June 5th. The stock was sold at an average price of $59.16, for a total transaction of $236,640.00. Following the completion of the sale, the insider directly owned 70,092 shares in the company, valued at approximately $4,146,642.72. This represents a 5.40% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last three months, insiders have sold 196,278 shares of company stock worth $12,428,868. Corporate insiders own 1.50% of the company's stock.

Institutional Investors Weigh In On Kratos Defense & Security Solutions

Hedge funds and other institutional investors have recently added to or reduced their stakes in the business. Mcguire Capital Advisors Inc. acquired a new position in shares of Kratos Defense & Security Solutions during the 4th quarter worth approximately $25,000. Atlantic Union Bankshares Corp lifted its holdings in Kratos Defense & Security Solutions by 7,600.0% during the 4th quarter. Atlantic Union Bankshares Corp now owns 385 shares of the aerospace company's stock valued at $29,000 after purchasing an additional 380 shares during the last quarter. Vision Retirement LLC lifted its holdings in Kratos Defense & Security Solutions by 288.2% during the 1st quarter. Vision Retirement LLC now owns 427 shares of the aerospace company's stock valued at $30,000 after purchasing an additional 317 shares during the last quarter. Rakuten Securities Inc. bought a new position in Kratos Defense & Security Solutions during the second quarter worth $31,000. Finally, Caitlin John LLC acquired a new position in shares of Kratos Defense & Security Solutions in the third quarter valued at $32,000. 75.92% of the stock is currently owned by institutional investors and hedge funds.

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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