Kratos Defense & Security Solutions (NASDAQ:KTOS) Stock Price Down 6.7% After Analyst Downgrade

Key Points

• Kratos Defense & Security Solutions saw its share price drop 6.7% after B. Riley downgraded the stock from a buy to a neutral rating, with a new price target of $105.00.
• Despite the downgrade, a majority of analysts still maintain positive outlooks, with 12 rating it a Buy and one a Strong Buy, reflecting a consensus rating of "Moderate Buy" with an average price target of $69.14.
• Insider selling activity was noted, including significant sales by CFO Deanna H. Lund and Thomas E. Iv Mills, which contributed to an overall reduction of insider ownership to 2.37%.

Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS - Get Free Report)'s share price fell 6.7% during trading on Thursday after B. Riley downgraded the stock from a buy rating to a neutral rating. B. Riley now has a $105.00 price target on the stock, up from their previous price target of $72.00. Kratos Defense & Security Solutions traded as low as $96.80 and last traded at $98.55. 8,042,804 shares were traded during mid-day trading, an increase of 125% from the average session volume of 3,574,038 shares. The stock had previously closed at $105.67.

Several other brokerages also recently weighed in on KTOS. Citigroup reissued an "outperform" rating on shares of Kratos Defense & Security Solutions in a research note on Thursday, October 2nd. Raymond James Financial reaffirmed a "strong-buy" rating on shares of Kratos Defense & Security Solutions in a research note on Friday, August 8th. Truist Financial upped their price objective on shares of Kratos Defense & Security Solutions from $38.00 to $52.00 and gave the company a "buy" rating in a research note on Friday, June 27th. Royal Bank Of Canada upped their price objective on shares of Kratos Defense & Security Solutions from $50.00 to $65.00 and gave the company an "outperform" rating in a research note on Friday, August 8th. Finally, Stifel Nicolaus boosted their target price on Kratos Defense & Security Solutions from $54.00 to $70.00 and gave the stock a "buy" rating in a report on Monday, July 21st. One equities research analyst has rated the stock with a Strong Buy rating, twelve have assigned a Buy rating and four have assigned a Hold rating to the company. Based on data from MarketBeat.com, the stock presently has a consensus rating of "Moderate Buy" and a consensus price target of $69.14.

Insider Activity at Kratos Defense & Security Solutions

In other news, insider Thomas E. Iv Mills sold 5,758 shares of the stock in a transaction that occurred on Tuesday, September 2nd. The stock was sold at an average price of $65.54, for a total transaction of $377,379.32. Following the completion of the transaction, the insider directly owned 9,692 shares in the company, valued at approximately $635,213.68. This represents a 37.27% decrease in their position. The transaction was disclosed in a filing with the SEC, which can be accessed through this hyperlink. Also, CFO Deanna H. Lund sold 5,000 shares of the stock in a transaction that occurred on Tuesday, August 19th. The shares were sold at an average price of $65.10, for a total value of $325,500.00. Following the transaction, the chief financial officer owned 313,327 shares of the company's stock, valued at approximately $20,397,587.70. This trade represents a 1.57% decrease in their ownership of the stock. The disclosure for this sale can be found here. In the last 90 days, insiders sold 82,276 shares of company stock worth $5,677,241. 2.37% of the stock is currently owned by insiders.

Hedge Funds Weigh In On Kratos Defense & Security Solutions

Several large investors have recently added to or reduced their stakes in KTOS. GAMMA Investing LLC lifted its stake in Kratos Defense & Security Solutions by 4,072.6% during the first quarter. GAMMA Investing LLC now owns 17,191 shares of the aerospace company's stock worth $510,000 after purchasing an additional 16,779 shares during the last quarter. Harbor Capital Advisors Inc. acquired a new stake in Kratos Defense & Security Solutions in the first quarter worth $1,367,000. Yousif Capital Management LLC acquired a new stake in Kratos Defense & Security Solutions in the first quarter worth $1,328,000. Salem Investment Counselors Inc. increased its position in Kratos Defense & Security Solutions by 5.6% in the first quarter. Salem Investment Counselors Inc. now owns 8,975 shares of the aerospace company's stock worth $266,000 after buying an additional 475 shares during the period. Finally, Wealth Enhancement Advisory Services LLC acquired a new stake in Kratos Defense & Security Solutions in the first quarter worth $594,000. 75.92% of the stock is currently owned by institutional investors.

Kratos Defense & Security Solutions Price Performance

The stock has a market capitalization of $16.63 billion, a price-to-earnings ratio of 985.60 and a beta of 1.12. The company has a debt-to-equity ratio of 0.12, a current ratio of 4.43 and a quick ratio of 3.88. The company has a 50-day simple moving average of $73.05 and a two-hundred day simple moving average of $51.09.

Kratos Defense & Security Solutions (NASDAQ:KTOS - Get Free Report) last issued its quarterly earnings results on Thursday, August 7th. The aerospace company reported $0.11 EPS for the quarter, beating analysts' consensus estimates of $0.09 by $0.02. The company had revenue of $351.50 million for the quarter, compared to analyst estimates of $305.67 million. Kratos Defense & Security Solutions had a return on equity of 3.10% and a net margin of 1.20%.The company's quarterly revenue was up 17.1% compared to the same quarter last year. During the same period last year, the company earned $0.14 earnings per share. Kratos Defense & Security Solutions has set its FY 2025 guidance at EPS. Q3 2025 guidance at EPS. On average, equities research analysts predict that Kratos Defense & Security Solutions, Inc. will post 0.31 earnings per share for the current year.

Kratos Defense & Security Solutions Company Profile

Kratos Defense & Security Solutions, Inc engages in the provision of mission critical products, services and solutions for United States national security priorities. It operates through the Kratos Government Solutions (KGS) and Unmanned Systems (US) segments. The KGS segment consists of an aggregation of KGS operating segments, including microwave electronic products, space, satellite and cyber, training solutions.

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