Leonardo DRS (NASDAQ:DRS) Shares Up 5.4% - Still a Buy?

Key Points

• Leonardo DRS shares rose 5.4% during Thursday trading, reaching as high as $48.82 as investors continued to respond to recent positive momentum in the stock.
• Wall Street sentiment is generally constructive: multiple analysts have issued buy or strong-buy ratings, and the consensus target price is about $53.75.
• The company’s latest earnings beat expectations, with EPS of $0.26 topping estimates and revenue of $846 million coming in above forecasts, while Leonardo DRS also maintained a quarterly dividend of $0.09 per share.

Leonardo DRS, Inc. (NASDAQ:DRS - Get Free Report)'s share price was up 5.4% during mid-day trading on Thursday . The stock traded as high as $48.82 and last traded at $48.41. Approximately 297,439 shares were traded during trading, a decline of 74% from the average daily volume of 1,130,514 shares. The stock had previously closed at $45.91.

Wall Street Analyst Weigh In

A number of research firms have recently weighed in on DRS. Wall Street Zen raised shares of Leonardo DRS from a "hold" rating to a "buy" rating in a research report on Sunday, May 10th. Bank of America increased their target price on Leonardo DRS from $50.00 to $55.00 and gave the stock a "buy" rating in a research report on Wednesday, March 25th. Canaccord Genuity Group lifted their price target on shares of Leonardo DRS from $52.00 to $54.00 and gave the company a "buy" rating in a research report on Wednesday, May 6th. Truist Financial upgraded Leonardo DRS to a "strong-buy" rating in a research note on Friday, May 1st. Finally, Weiss Ratings downgraded Leonardo DRS from a "hold (c+)" rating to a "hold (c)" rating in a research report on Tuesday, June 23rd. One investment analyst has rated the stock with a Strong Buy rating, two have issued a Buy rating and three have issued a Hold rating to the company. According to MarketBeat, the stock presently has a consensus rating of "Moderate Buy" and an average target price of $53.75.

Leonardo DRS Stock Up 4.4%

The firm's 50 day moving average price is $45.11 and its two-hundred day moving average price is $43.48. The firm has a market capitalization of $12.79 billion, a PE ratio of 44.88, a P/E/G ratio of 3.28 and a beta of 0.36. The company has a quick ratio of 1.52, a current ratio of 1.86 and a debt-to-equity ratio of 0.05.

Leonardo DRS (NASDAQ:DRS - Get Free Report) last issued its quarterly earnings data on Tuesday, May 5th. The company reported $0.26 EPS for the quarter, topping analysts' consensus estimates of $0.21 by $0.05. The firm had revenue of $846.00 million for the quarter, compared to analyst estimates of $825.05 million. Leonardo DRS had a net margin of 7.85% and a return on equity of 12.02%. The firm's revenue was up 5.9% compared to the same quarter last year. During the same quarter in the previous year, the business posted $0.20 EPS. Leonardo DRS has set its FY 2026 guidance at 1.260-1.300 EPS. As a group, research analysts forecast that Leonardo DRS, Inc. will post 1.3 EPS for the current fiscal year.

Leonardo DRS Announces Dividend

The firm also recently disclosed a quarterly dividend, which was paid on Tuesday, June 2nd. Shareholders of record on Tuesday, May 19th were paid a dividend of $0.09 per share. This represents a $0.36 dividend on an annualized basis and a yield of 0.8%. The ex-dividend date was Tuesday, May 19th. Leonardo DRS's dividend payout ratio (DPR) is 33.64%.

Insider Activity at Leonardo DRS

In other news, SVP Pamela Morrow sold 11,545 shares of the firm's stock in a transaction that occurred on Wednesday, May 27th. The shares were sold at an average price of $45.13, for a total transaction of $521,025.85. Following the completion of the sale, the senior vice president owned 10,551 shares of the company's stock, valued at approximately $476,166.63. This trade represents a 52.25% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, CEO John Baylouny sold 36,471 shares of Leonardo DRS stock in a transaction on Thursday, June 18th. The stock was sold at an average price of $45.67, for a total transaction of $1,665,630.57. Following the completion of the sale, the chief executive officer owned 122,435 shares of the company's stock, valued at approximately $5,591,606.45. This trade represents a 22.95% 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. Insiders sold 65,364 shares of company stock worth $2,994,785 over the last ninety days. Company insiders own 0.25% of the company's stock.

Institutional Investors Weigh In On Leonardo DRS

Several hedge funds and other institutional investors have recently modified their holdings of the stock. Quarry LP lifted its position in shares of Leonardo DRS by 7,041.7% during the fourth quarter. Quarry LP now owns 857 shares of the company's stock worth $29,000 after purchasing an additional 845 shares during the last quarter. Leonteq Securities AG bought a new stake in Leonardo DRS in the fourth quarter valued at about $34,000. Allworth Financial LP raised its stake in Leonardo DRS by 504.1% during the third quarter. Allworth Financial LP now owns 882 shares of the company's stock valued at $40,000 after buying an additional 736 shares in the last quarter. Fifth Third Bancorp acquired a new stake in Leonardo DRS during the first quarter valued at approximately $41,000. Finally, Pilgrim Partners Asia Pte Ltd bought a new position in Leonardo DRS during the 4th quarter worth approximately $46,000. Institutional investors own 18.76% of the company's stock.

Leonardo DRS Company Profile

Leonardo DRS is a U.S.-based defense technology company and wholly owned subsidiary of Italy's Leonardo S.p.A. The firm specializes in developing and integrating mission-critical systems for military and government customers, with a primary focus on command, control, communications, computers, intelligence, surveillance and reconnaissance (C4ISR). Its core offerings encompass advanced sensors, targeting systems, radars and electronic warfare solutions designed to enhance situational awareness and operational effectiveness across land, sea and air domains.

The company's portfolio includes naval combat management systems, unmanned vehicle sensors, power generation and distribution equipment, and training and simulation solutions.

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