Shares of Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) have received an average rating of “Moderate Buy” from nineteen analysts currently covering the company, according to Marketbeat.com. Analysts have issued mixed recommendations, with six suggesting a hold, twelve endorsing a buy, and one advocating for a strong buy.
The consensus target price for the stock stands at approximately $82.06, reflecting a range of opinions among brokerage firms that have updated their coverage in the past year. Notably, BTIG Research raised its target price from $80.00 to $95.00 while maintaining a buy rating in a report dated November 6, 2023. Similarly, JMP Securities increased its price objective from $70.00 to $105.00 with a “market outperform” rating on October 2, 2023.
In contrast, Jefferies Financial Group reaffirmed a “hold” rating with a price target of $85.00 in a recent research note, also dated November 6, 2023. Meanwhile, Truist Financial elevated its price target from $78.00 to $125.00 and recommended a buy rating in a report released on October 15, 2023. Additionally, BNP Paribas Exane began coverage on November 18, 2023, assigning a “neutral” rating with a target price of $80.00.
Institutional Investments and Market Performance
Recent trading activity has shown that hedge funds and institutional investors are actively adjusting their positions in Kratos Defense. Notable transactions include Costello Asset Management INC, which acquired a new stake valued at approximately $29,000 in the first quarter. Similarly, TD Waterhouse Canada Inc. and Rakuten Securities Inc. made new investments worth approximately $30,000 and $31,000, respectively, during the second quarter.
As of now, approximately 75.92% of Kratos Defense’s stock is owned by hedge funds and institutional investors, reflecting significant confidence in the company’s future prospects. However, shares of KTOS opened at $73.21 on the most recent trading day, showing a decline of 3.8%.
The company’s financial health remains robust, with a current ratio of 4.43, a quick ratio of 3.88, and a debt-to-equity ratio of 0.12. Over the past year, Kratos Defense has seen its stock fluctuate, reaching a low of $23.90 and a high of $112.57. The firm boasts a market capitalization of $12.36 billion and a price-to-earnings ratio of 732.17.
Recent Earnings Performance
On November 4, 2023, Kratos Defense announced its quarterly earnings, reporting earnings per share (EPS) of $0.14, which surpassed the consensus estimate of $0.12 by $0.02. The company achieved a net margin of 1.20% and a return on equity of 3.10%. Revenue for the quarter reached $347.60 million, outpacing analyst expectations of $323.01 million. This figure also marks a significant 26.0% increase compared to the same quarter last year.
Looking ahead, Kratos Defense has set its fiscal year 2025 guidance at an EPS of $0.31, indicating positive growth expectations. As the company continues to navigate the defense and security landscape, its performance remains closely monitored by investors and analysts alike.
