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Kratos Defense and Security Solutions Inc

Kratos Defense and Security Solutions Inc

KTOS
$46.03USD↓-1.98%-0.93 today

MARKET CAP

8.6B

P/E (TTM)

78.0x

FWD P/E

50.7x

DAY RANGE

$46 – $47

52W RANGE

$46
$134

AI Summary

Stalk
Sell NowMedium

KTOS remains entrenched in a Stage 4 decline with a clear sequence of lower highs and lower lows. Price is trading below the 9EMA, 20EMA, and 50DMA and is rejecting at these resistance levels. The short-term downtrend is intact with no signs of exhaustion, reinforcing a medium-term bearish bias. We will Sell Now to participate in further downside continuation through the current consolidation zone.

  • ↑Revenue $371M (+15.8% YoY) vs guidance $335M; backlog $2B with 1.6 book-to-bill.
  • ↑FY26 revenue guidance raised to $1.7B–$1.76B, implying 15%–19% organic growth.
  • ↓Negative earnings yield indicates margin pressure from higher material costs.
Full analysis →

The case for & against

Bull & Bear analysis

Bullish

Kratos Defense and Security Solutions, Inc. (NASDAQ: KTOS) is a key player in the aerospace and defense sector, specializing in advanced defense technologies including unmanned systems, hypersonics, microwave electronics, and satellite communications. The company stands out for its focus on affordability and rapid deployment capabilities, allowing it to compete effectively in a market characterized by high defense spending and evolving military requirements.

Bull says

  • ↑Revenue $371M (+15.8% YoY) vs guidance $335M; backlog $2B with 1.6 book-to-bill.
  • ↑FY26 revenue guidance raised to $1.7B–$1.76B, implying 15%–19% organic growth.
  • ↑Secured ~$400M in hypersonic and $100M in space domain contracts.
  • ↑CapEx guidance upped to $160M to scale unmanned systems and hypersonics.
  • ↑High liquidity and strong growth factor exposure support expansion.
  • ↑$14B pipeline driven by rising national security budgets.

Bear says

  • ↓Negative earnings yield indicates margin pressure from higher material costs.
  • ↓Q1 operating cash flow burn $29M vs CapEx $160M strains cash reserves.
  • ↓Execution risk in scaling military-grade products could delay deliveries.
  • ↓Analysts are cutting earnings forecasts; revisions signal downside risk.
  • ↓High short interest reflects investor skepticism on execution and cash flow.
  • ↓Elevated leverage and weak momentum factors expose vulnerability.

Investment themes with KTOS

Defense↓ -0.89%

Military equipment and defense contractors

BWXT · RKLB · CRS
Defense Tech↓ -0.44%

LMT · RTX · GD
Drones↓ -2.03%

Unmanned aerial vehicles and related technology

AVAV · ONDS · RCAT

Earnings Call · Q1 2026 · Mgmt. Guidance

Updated 05-08-2026neutral

Transcript signals

Bull points

  • So you can make more money, and at the same time, you can lower your price to the government. So your margins can go up, and their cost of paying you can go down because you're getting so efficient.
  • Let me give you an example. We recently had multiple successful ballistic missile target launches. Kratos did.
  • Our ballistic missile targets, so these represent adversary's ballistic missile targets, decoys, chaff, flares, all kinds, countermeasures, et cetera. Our most expensive all-in-one, I think, is 15 million a shot. I think the competing one's 100.

Bear points

  • we are not aggressively pursuing anything, nothing, zero. However, right now, there are a couple, three small companies where they're retiring.
  • I think it would, and obviously we're not giving any guidance for next year, but I think the elevations of CapEx will continue. I don't think it'll be at that level, but just with the initiatives we have going on, I think it will continue to be elevated in 27.
  • So our number one operational challenge right now is obtaining and retaining qualified people.
Read full transcript analysis ›