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LEONARDO DRS INC (DRS) Stock Fundamental Analysis

NASDAQ:DRS - Nasdaq - US52661A1088 - Common Stock - Currency: USD

41.48  -0.77 (-1.82%)

After market: 42 +0.52 (+1.25%)

Fundamental Rating

6

Taking everything into account, DRS scores 6 out of 10 in our fundamental rating. DRS was compared to 67 industry peers in the Aerospace & Defense industry. DRS is in great health and has no worries on liquidiy or solvency at all, but the profibility rating is only average. DRS is not valued too expensively and it also shows a decent growth rate.


Dividend Valuation Growth Profitability Health

6

1. Profitability

1.1 Basic Checks

DRS had positive earnings in the past year.
In the past year DRS had a positive cash flow from operations.
Each year in the past 5 years DRS has been profitable.
DRS had a positive operating cash flow in 4 of the past 5 years.
DRS Yearly Net Income VS EBIT VS OCF VS FCFDRS Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 200M 400M 600M 800M

1.2 Ratios

Looking at the Return On Assets, with a value of 6.13%, DRS is in the better half of the industry, outperforming 73.13% of the companies in the same industry.
DRS has a Return On Equity of 9.62%. This is in the better half of the industry: DRS outperforms 64.18% of its industry peers.
The Return On Invested Capital of DRS (8.81%) is better than 76.12% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for DRS is significantly above the industry average of 8.42%.
The last Return On Invested Capital (8.81%) for DRS is well below the 3 year average (14.80%), which needs to be investigated, but indicates that DRS had better years and this may not be a problem.
Industry RankSector Rank
ROA 6.13%
ROE 9.62%
ROIC 8.81%
ROA(3y)6.8%
ROA(5y)7.59%
ROE(3y)11.53%
ROE(5y)11.69%
ROIC(3y)14.8%
ROIC(5y)12.07%
DRS Yearly ROA, ROE, ROICDRS Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 -20 -40 -60

1.3 Margins

With a decent Profit Margin value of 7.31%, DRS is doing good in the industry, outperforming 68.66% of the companies in the same industry.
DRS's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 9.56%, DRS is in the better half of the industry, outperforming 62.69% of the companies in the same industry.
In the last couple of years the Operating Margin of DRS has declined.
The Gross Margin of DRS (23.15%) is comparable to the rest of the industry.
DRS's Gross Margin has declined in the last couple of years.
Industry RankSector Rank
OM 9.56%
PM (TTM) 7.31%
GM 23.15%
OM growth 3Y-18.83%
OM growth 5YN/A
PM growth 3Y-32.5%
PM growth 5YN/A
GM growth 3Y-17.5%
GM growth 5Y-8.71%
DRS Yearly Profit, Operating, Gross MarginsDRS Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 -20 40 -40

7

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so DRS is still creating some value.
Compared to 1 year ago, DRS has more shares outstanding
Compared to 5 years ago, DRS has more shares outstanding
DRS has a better debt/assets ratio than last year.
DRS Yearly Shares OutstandingDRS Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 50M 100M 150M 200M 250M
DRS Yearly Total Debt VS Total AssetsDRS Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B 4B

2.2 Solvency

An Altman-Z score of 5.12 indicates that DRS is not in any danger for bankruptcy at the moment.
DRS has a Altman-Z score of 5.12. This is in the better half of the industry: DRS outperforms 62.69% of its industry peers.
DRS has a debt to FCF ratio of 1.50. This is a very positive value and a sign of high solvency as it would only need 1.50 years to pay back of all of its debts.
DRS has a Debt to FCF ratio of 1.50. This is amongst the best in the industry. DRS outperforms 95.52% of its industry peers.
A Debt/Equity ratio of 0.13 indicates that DRS is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.13, DRS is in the better half of the industry, outperforming 79.10% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.13
Debt/FCF 1.5
Altman-Z 5.12
ROIC/WACC0.88
WACC9.99%
DRS Yearly LT Debt VS Equity VS FCFDRS Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 500M 1B 1.5B 2B 2.5B

2.3 Liquidity

A Current Ratio of 2.11 indicates that DRS has no problem at all paying its short term obligations.
With a Current ratio value of 2.11, DRS perfoms like the industry average, outperforming 49.25% of the companies in the same industry.
DRS has a Quick Ratio of 1.70. This is a normal value and indicates that DRS is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.70, DRS is in the better half of the industry, outperforming 64.18% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 2.11
Quick Ratio 1.7
DRS Yearly Current Assets VS Current LiabilitesDRS Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 500M 1B 1.5B 2B

6

3. Growth

3.1 Past

DRS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 26.51%, which is quite impressive.
The Earnings Per Share has been growing by 23.42% on average over the past years. This is a very strong growth
Looking at the last year, DRS shows a quite strong growth in Revenue. The Revenue has grown by 11.43% in the last year.
DRS shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 135.87% yearly.
EPS 1Y (TTM)26.51%
EPS 3Y23.42%
EPS 5YN/A
EPS Q2Q%27.78%
Revenue 1Y (TTM)11.43%
Revenue growth 3Y202.18%
Revenue growth 5Y135.87%
Sales Q2Q%10.09%

3.2 Future

The Earnings Per Share is expected to grow by 9.12% on average over the next years. This is quite good.
The Revenue is expected to grow by 6.63% on average over the next years.
EPS Next Y15.92%
EPS Next 2Y16.3%
EPS Next 3Y14.53%
EPS Next 5Y9.12%
Revenue Next Year10.26%
Revenue Next 2Y8.36%
Revenue Next 3Y7.28%
Revenue Next 5Y6.63%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
DRS Yearly Revenue VS EstimatesDRS Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 1B 2B 3B 4B
DRS Yearly EPS VS EstimatesDRS Yearly EPS VS EstimatesYearly EPS VS Estimates 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 0 0.5 1

4

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 39.50, the valuation of DRS can be described as expensive.
DRS's Price/Earnings ratio is a bit cheaper when compared to the industry. DRS is cheaper than 65.67% of the companies in the same industry.
DRS is valuated rather expensively when we compare the Price/Earnings ratio to 27.03, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 32.62 indicates a quite expensive valuation of DRS.
Based on the Price/Forward Earnings ratio, DRS is valued a bit cheaper than 61.19% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 36.28, DRS is valued at the same level.
Industry RankSector Rank
PE 39.5
Fwd PE 32.62
DRS Price Earnings VS Forward Price EarningsDRS Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60

4.2 Price Multiples

The rest of the industry has a similar Enterprise Value to EBITDA ratio as DRS.
Based on the Price/Free Cash Flow ratio, DRS is valued a bit cheaper than the industry average as 74.63% of the companies are valued more expensively.
Industry RankSector Rank
P/FCF 46.96
EV/EBITDA 27.01
DRS Per share dataDRS EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 2 4 6 8 10

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
DRS has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as DRS's earnings are expected to grow with 14.53% in the coming years.
PEG (NY)2.48
PEG (5Y)N/A
EPS Next 2Y16.3%
EPS Next 3Y14.53%

3

5. Dividend

5.1 Amount

DRS has a yearly dividend return of 0.86%, which is pretty low.
DRS's Dividend Yield is rather good when compared to the industry average which is at 1.16. DRS pays more dividend than 83.58% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.40, DRS's dividend is way lower than the S&P500 average.
Industry RankSector Rank
Dividend Yield 0.86%

5.2 History

DRS does not have a reliable dividend history as it only pays dividend since a couple or years.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
DRS Yearly Dividends per shareDRS Yearly Dividends per shareYearly Dividends per share 2025 0.05 0.1 0.15 0.2 0.25

5.3 Sustainability

DRS pays out 19.20% of its income as dividend. This is a sustainable payout ratio.
DP19.2%
EPS Next 2Y16.3%
EPS Next 3Y14.53%
DRS Yearly Income VS Free CF VS DividendDRS Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 100M 200M 300M 400M
DRS Dividend Payout.DRS Dividend Payout, showing the Payout Ratio.DRS Dividend Payout.PayoutRetained Earnings

LEONARDO DRS INC

NASDAQ:DRS (8/5/2025, 8:10:44 PM)

After market: 42 +0.52 (+1.25%)

41.48

-0.77 (-1.82%)

Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)07-30 2025-07-30/bmo
Earnings (Next)10-28 2025-10-28/amc
Inst Owners26.82%
Inst Owner Change-1.28%
Ins Owners0.33%
Ins Owner Change35.86%
Market Cap11.04B
Analysts81.54
Price Target48.83 (17.72%)
Short Float %2.18%
Short Ratio1.27
Dividend
Industry RankSector Rank
Dividend Yield 0.86%
Yearly Dividend0
Dividend Growth(5Y)N/A
DP19.2%
Div Incr Years0
Div Non Decr Years0
Ex-Date08-20 2025-08-20 (0.09)
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)13.27%
Min EPS beat(2)6.54%
Max EPS beat(2)20.01%
EPS beat(4)4
Avg EPS beat(4)13.69%
Min EPS beat(4)6.36%
Max EPS beat(4)21.86%
EPS beat(8)8
Avg EPS beat(8)18.04%
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)1
Avg Revenue beat(2)3.29%
Min Revenue beat(2)-0.81%
Max Revenue beat(2)7.38%
Revenue beat(4)3
Avg Revenue beat(4)3.34%
Min Revenue beat(4)-0.81%
Max Revenue beat(4)7.38%
Revenue beat(8)7
Avg Revenue beat(8)4.36%
Revenue beat(12)9
Avg Revenue beat(12)159.28%
Revenue beat(16)11
Avg Revenue beat(16)362.96%
PT rev (1m)2.48%
PT rev (3m)25.99%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0%
EPS NY rev (1m)0.36%
EPS NY rev (3m)1.42%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.9%
Revenue NY rev (1m)0.14%
Revenue NY rev (3m)1.05%
Valuation
Industry RankSector Rank
PE 39.5
Fwd PE 32.62
P/S 3.23
P/FCF 46.96
P/OCF 32.84
P/B 4.24
P/tB 8.89
EV/EBITDA 27.01
EPS(TTM)1.05
EY2.53%
EPS(NY)1.27
Fwd EY3.07%
FCF(TTM)0.88
FCFY2.13%
OCF(TTM)1.26
OCFY3.04%
SpS12.86
BVpS9.77
TBVpS4.67
PEG (NY)2.48
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 6.13%
ROE 9.62%
ROCE 10.48%
ROIC 8.81%
ROICexc 9.67%
ROICexgc 18.52%
OM 9.56%
PM (TTM) 7.31%
GM 23.15%
FCFM 6.87%
ROA(3y)6.8%
ROA(5y)7.59%
ROE(3y)11.53%
ROE(5y)11.69%
ROIC(3y)14.8%
ROIC(5y)12.07%
ROICexc(3y)17.19%
ROICexc(5y)16.27%
ROICexgc(3y)41.83%
ROICexgc(5y)31.06%
ROCE(3y)17.68%
ROCE(5y)14.42%
ROICexcg growth 3Y5.24%
ROICexcg growth 5YN/A
ROICexc growth 3Y-19.58%
ROICexc growth 5YN/A
OM growth 3Y-18.83%
OM growth 5YN/A
PM growth 3Y-32.5%
PM growth 5YN/A
GM growth 3Y-17.5%
GM growth 5Y-8.71%
F-Score9
Asset Turnover0.84
Health
Industry RankSector Rank
Debt/Equity 0.13
Debt/FCF 1.5
Debt/EBITDA 0.79
Cap/Depr 109.78%
Cap/Sales 2.95%
Interest Coverage 250
Cash Conversion 80.19%
Profit Quality 94%
Current Ratio 2.11
Quick Ratio 1.7
Altman-Z 5.12
F-Score9
WACC9.99%
ROIC/WACC0.88
Cap/Depr(3y)88%
Cap/Depr(5y)129.75%
Cap/Sales(3y)2.39%
Cap/Sales(5y)3.79%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)26.51%
EPS 3Y23.42%
EPS 5YN/A
EPS Q2Q%27.78%
EPS Next Y15.92%
EPS Next 2Y16.3%
EPS Next 3Y14.53%
EPS Next 5Y9.12%
Revenue 1Y (TTM)11.43%
Revenue growth 3Y202.18%
Revenue growth 5Y135.87%
Sales Q2Q%10.09%
Revenue Next Year10.26%
Revenue Next 2Y8.36%
Revenue Next 3Y7.28%
Revenue Next 5Y6.63%
EBIT growth 1Y22.01%
EBIT growth 3Y145.27%
EBIT growth 5YN/A
EBIT Next Year43.33%
EBIT Next 3Y21.71%
EBIT Next 5Y15.46%
FCF growth 1Y266.67%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y573.24%
OCF growth 3YN/A
OCF growth 5YN/A