Kratos Defense & Security Solutions (NASDAQ:KTOS) Trading Down 7.6% - Time to Sell?

Key Points

• Kratos Defense & Security Solutions fell 7.6% on Wednesday, closing at $58.43 after trading as low as $57.90, with volume running above average.
• Despite the drop, the company recently beat quarterly earnings and revenue estimates, reporting EPS of $0.16 versus $0.13 expected and revenue of $371 million versus $345 million expected, with revenue up 22.6% year over year.
• Analyst sentiment remains mostly positive, with a consensus “Moderate Buy” and average price target of $96.28, though some firms have trimmed targets; meanwhile, insiders have been selling shares in recent months.

Shares of Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS - Get Free Report) traded down 7.6% on Wednesday . The company traded as low as $57.90 and last traded at $58.43. 5,077,811 shares were traded during mid-day trading, an increase of 15% from the average session volume of 4,405,077 shares. The stock had previously closed at $63.27.

Analysts Set New Price Targets

A number of research analysts have weighed in on the company. Canaccord Genuity Group increased their target price 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. UBS Group reissued a "neutral" rating and issued a $82.00 target price on shares of Kratos Defense & Security Solutions in a report on Thursday, May 7th. Royal Bank Of Canada lowered their target price on 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. Truist Financial raised Kratos Defense & Security Solutions to a "strong-buy" rating in a report on Friday, May 1st. Finally, Citigroup reissued a "market outperform" rating on shares of Kratos Defense & Security Solutions in a report on Tuesday, February 24th. Three analysts have rated the stock with a Strong Buy rating, fifteen have given a Buy rating and five have assigned a Hold rating to the stock. According to data from MarketBeat.com, Kratos Defense & Security Solutions has an average rating of "Moderate Buy" and a consensus target price of $96.28.

Kratos Defense & Security Solutions Price Performance

The firm has a 50 day moving average of $65.33 and a 200-day moving average of $80.97. The company has a market cap of $10.96 billion, a P/E ratio of 343.71 and a beta of 1.04. The company has a current ratio of 5.63, a quick ratio of 5.08 and a debt-to-equity ratio of 0.04.

Kratos Defense & Security Solutions (NASDAQ:KTOS - Get Free Report) last issued its earnings results on Wednesday, May 6th. The aerospace company reported $0.16 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.13 by $0.03. The company had revenue of $371.00 million for the quarter, compared to the consensus estimate of $345.00 million. Kratos Defense & Security Solutions had a return on equity of 2.82% and a net margin of 2.08%.The firm's quarterly revenue was up 22.6% on a year-over-year basis. During the same quarter last year, the company earned $0.12 EPS. On average, equities research analysts predict that Kratos Defense & Security Solutions, Inc. will post 0.5 EPS for the current year.

Insider Activity at Kratos Defense & Security Solutions

In related news, insider Steven S. Fendley sold 7,000 shares of Kratos Defense & Security Solutions stock in a transaction that occurred on Tuesday, May 26th. The stock was sold at an average price of $57.24, for a total transaction of $400,680.00. Following the sale, the insider owned 344,090 shares of the company's stock, valued at approximately $19,695,711.60. This trade represents a 1.99% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, SVP Marie Mendoza sold 1,013 shares of Kratos Defense & Security Solutions stock in a transaction that occurred on Friday, May 15th. The shares were sold at an average price of $53.49, for a total value of $54,185.37. Following the sale, the senior vice president directly owned 65,996 shares in the company, valued at $3,530,126.04. This trade represents a 1.51% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 188,630 shares of company stock worth $13,301,792 in the last three months. Corporate insiders own 1.50% of the company's stock.

Institutional Trading of Kratos Defense & Security Solutions

Large investors have recently added to or reduced their stakes in the company. Mcguire Capital Advisors Inc. purchased a new stake in Kratos Defense & Security Solutions during the fourth quarter valued at $25,000. Atlantic Union Bankshares Corp raised its stake in 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 purchasing an additional 380 shares in the last quarter. Vision Retirement LLC raised its stake in Kratos Defense & Security Solutions by 288.2% during the first quarter. Vision Retirement LLC now owns 427 shares of the aerospace company's stock valued at $30,000 after purchasing an additional 317 shares in the last quarter. Rakuten Securities Inc. purchased a new stake in Kratos Defense & Security Solutions during the second quarter valued at $31,000. Finally, Caitlin John LLC purchased a new stake in Kratos Defense & Security Solutions during the third quarter valued at $32,000. Institutional investors own 75.92% of the company's stock.

About Kratos Defense & Security Solutions

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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