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KRATOS DEFENSE & SECURITY (KTOS) Stock Fundamental Analysis

NASDAQ:KTOS - Nasdaq - US50077B2079 - Common Stock - Currency: USD

43.23  +2.02 (+4.9%)

After market: 43.0001 -0.23 (-0.53%)

Fundamental Rating

4

KTOS gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 64 industry peers in the Aerospace & Defense industry. The financial health of KTOS is average, but there are quite some concerns on its profitability. KTOS is valued quite expensive, but it does show an excellent growth.


Dividend Valuation Growth Profitability Health

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3

1. Profitability

1.1 Basic Checks

KTOS had positive earnings in the past year.
In the past year KTOS had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: KTOS reported negative net income in multiple years.
Of the past 5 years KTOS 4 years had a positive operating cash flow.
KTOS Yearly Net Income VS EBIT VS OCF VS FCFKTOS 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 50M -50M 100M 150M 200M

1.2 Ratios

KTOS has a Return On Assets of 0.97%. This is in the lower half of the industry: KTOS underperforms 60.94% of its industry peers.
With a Return On Equity value of 1.41%, KTOS perfoms like the industry average, outperforming 42.19% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 1.51%, KTOS is doing worse than 60.94% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for KTOS is significantly below the industry average of 8.39%.
The last Return On Invested Capital (1.51%) for KTOS is above the 3 year average (1.26%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 0.97%
ROE 1.41%
ROIC 1.51%
ROA(3y)-0.7%
ROA(5y)0.58%
ROE(3y)-1.22%
ROE(5y)0.95%
ROIC(3y)1.26%
ROIC(5y)1.46%
KTOS Yearly ROA, ROE, ROICKTOS Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 -10 -20

1.3 Margins

The Profit Margin of KTOS (1.68%) is comparable to the rest of the industry.
KTOS's Profit Margin has declined in the last couple of years.
KTOS has a Operating Margin of 2.80%. This is in the lower half of the industry: KTOS underperforms 60.94% of its industry peers.
KTOS's Operating Margin has declined in the last couple of years.
KTOS has a Gross Margin of 24.95%. This is comparable to the rest of the industry: KTOS outperforms 50.00% of its industry peers.
In the last couple of years the Gross Margin of KTOS has remained more or less at the same level.
Industry RankSector Rank
OM 2.8%
PM (TTM) 1.68%
GM 24.95%
OM growth 3Y-7.51%
OM growth 5Y-12.8%
PM growth 3YN/A
PM growth 5Y-3.81%
GM growth 3Y-3.05%
GM growth 5Y-0.93%
KTOS Yearly Profit, Operating, Gross MarginsKTOS Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 10 -10 20

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5

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), KTOS is destroying value.
The number of shares outstanding for KTOS has been increased compared to 1 year ago.
KTOS has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, KTOS has an improved debt to assets ratio.
KTOS Yearly Shares OutstandingKTOS Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 50M 100M 150M
KTOS Yearly Total Debt VS Total AssetsKTOS Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 500M 1B 1.5B

2.2 Solvency

An Altman-Z score of 6.65 indicates that KTOS is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 6.65, KTOS is in the better half of the industry, outperforming 75.00% of the companies in the same industry.
KTOS has a Debt/Equity ratio of 0.17. This is a healthy value indicating a solid balance between debt and equity.
KTOS has a better Debt to Equity ratio (0.17) than 75.00% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.17
Debt/FCF N/A
Altman-Z 6.65
ROIC/WACC0.15
WACC10.12%
KTOS Yearly LT Debt VS Equity VS FCFKTOS 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

2.3 Liquidity

KTOS has a Current Ratio of 2.84. This indicates that KTOS is financially healthy and has no problem in meeting its short term obligations.
KTOS has a Current ratio of 2.84. This is in the better half of the industry: KTOS outperforms 60.94% of its industry peers.
A Quick Ratio of 2.26 indicates that KTOS has no problem at all paying its short term obligations.
KTOS's Quick ratio of 2.26 is fine compared to the rest of the industry. KTOS outperforms 75.00% of its industry peers.
Industry RankSector Rank
Current Ratio 2.84
Quick Ratio 2.26
KTOS Yearly Current Assets VS Current LiabilitesKTOS Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 200M 400M 600M 800M

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7

3. Growth

3.1 Past

The Earnings Per Share has grown by an nice 13.64% over the past year.
Measured over the past 5 years, KTOS shows a small growth in Earnings Per Share. The EPS has been growing by 7.58% on average per year.
Looking at the last year, KTOS shows a small growth in Revenue. The Revenue has grown by 7.32% in the last year.
KTOS shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 9.63% yearly.
EPS 1Y (TTM)13.64%
EPS 3Y15.26%
EPS 5Y7.58%
EPS Q2Q%9.09%
Revenue 1Y (TTM)7.32%
Revenue growth 3Y11.88%
Revenue growth 5Y9.63%
Sales Q2Q%9.16%

3.2 Future

Based on estimates for the next years, KTOS will show a very strong growth in Earnings Per Share. The EPS will grow by 25.15% on average per year.
Based on estimates for the next years, KTOS will show a quite strong growth in Revenue. The Revenue will grow by 13.74% on average per year.
EPS Next Y6.58%
EPS Next 2Y21.1%
EPS Next 3Y19.15%
EPS Next 5Y25.15%
Revenue Next Year12.71%
Revenue Next 2Y14.27%
Revenue Next 3Y14.23%
Revenue Next 5Y13.74%

3.3 Evolution

The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
KTOS Yearly Revenue VS EstimatesKTOS Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 500M 1B 1.5B 2B 2.5B
KTOS Yearly EPS VS EstimatesKTOS Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 0 0.5 -0.5 1 1.5

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1

4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 86.46, KTOS can be considered very expensive at the moment.
The rest of the industry has a similar Price/Earnings ratio as KTOS.
KTOS's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 26.32.
With a Price/Forward Earnings ratio of 60.16, KTOS can be considered very expensive at the moment.
KTOS's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. KTOS is more expensive than 60.94% of the companies in the same industry.
KTOS's Price/Forward Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 22.19.
Industry RankSector Rank
PE 86.46
Fwd PE 60.16
KTOS Price Earnings VS Forward Price EarningsKTOS Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60 80

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, KTOS is valued a bit more expensive than 64.06% of the companies in the same industry.
Industry RankSector Rank
P/FCF N/A
EV/EBITDA 85.14
KTOS Per share dataKTOS EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 2 4 6 8

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates KTOS does not grow enough to justify the current Price/Earnings ratio.
KTOS's earnings are expected to grow with 19.14% in the coming years. This may justify a more expensive valuation.
PEG (NY)13.14
PEG (5Y)11.4
EPS Next 2Y21.1%
EPS Next 3Y19.15%

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0

5. Dividend

5.1 Amount

KTOS does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

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KRATOS DEFENSE & SECURITY

NASDAQ:KTOS (6/17/2025, 8:00:02 PM)

After market: 43.0001 -0.23 (-0.53%)

43.23

+2.02 (+4.9%)

Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)05-07 2025-05-07/amc
Earnings (Next)08-05 2025-08-05/amc
Inst Owners104.86%
Inst Owner Change18.64%
Ins Owners1.76%
Ins Owner Change3.51%
Market Cap6.63B
Analysts78.89
Price Target38.25 (-11.52%)
Short Float %6.43%
Short Ratio4.48
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)26.32%
Min EPS beat(2)25.78%
Max EPS beat(2)26.87%
EPS beat(4)4
Avg EPS beat(4)35.87%
Min EPS beat(4)25.78%
Max EPS beat(4)61.67%
EPS beat(8)8
Avg EPS beat(8)48.2%
EPS beat(12)12
Avg EPS beat(12)40.57%
EPS beat(16)15
Avg EPS beat(16)41.93%
Revenue beat(2)1
Avg Revenue beat(2)-0.99%
Min Revenue beat(2)-3.26%
Max Revenue beat(2)1.28%
Revenue beat(4)2
Avg Revenue beat(4)0.53%
Min Revenue beat(4)-3.26%
Max Revenue beat(4)6.52%
Revenue beat(8)6
Avg Revenue beat(8)3.74%
Revenue beat(12)9
Avg Revenue beat(12)3%
Revenue beat(16)10
Avg Revenue beat(16)1.9%
PT rev (1m)7.14%
PT rev (3m)14.9%
EPS NQ rev (1m)-9.91%
EPS NQ rev (3m)-26.2%
EPS NY rev (1m)0%
EPS NY rev (3m)-12.4%
Revenue NQ rev (1m)-1.08%
Revenue NQ rev (3m)-2.6%
Revenue NY rev (1m)0.08%
Revenue NY rev (3m)0.61%
Valuation
Industry RankSector Rank
PE 86.46
Fwd PE 60.16
P/S 5.7
P/FCF N/A
P/OCF 334.68
P/B 4.78
P/tB 9.1
EV/EBITDA 85.14
EPS(TTM)0.5
EY1.16%
EPS(NY)0.72
Fwd EY1.66%
FCF(TTM)-0.29
FCFYN/A
OCF(TTM)0.13
OCFY0.3%
SpS7.58
BVpS9.05
TBVpS4.75
PEG (NY)13.14
PEG (5Y)11.4
Profitability
Industry RankSector Rank
ROA 0.97%
ROE 1.41%
ROCE 1.91%
ROIC 1.51%
ROICexc 1.79%
ROICexgc 3.3%
OM 2.8%
PM (TTM) 1.68%
GM 24.95%
FCFM N/A
ROA(3y)-0.7%
ROA(5y)0.58%
ROE(3y)-1.22%
ROE(5y)0.95%
ROIC(3y)1.26%
ROIC(5y)1.46%
ROICexc(3y)1.43%
ROICexc(5y)1.83%
ROICexgc(3y)2.78%
ROICexgc(5y)3.74%
ROCE(3y)1.59%
ROCE(5y)1.85%
ROICexcg growth 3Y-8.73%
ROICexcg growth 5Y-17.52%
ROICexc growth 3Y-5.2%
ROICexc growth 5Y-12.92%
OM growth 3Y-7.51%
OM growth 5Y-12.8%
PM growth 3YN/A
PM growth 5Y-3.81%
GM growth 3Y-3.05%
GM growth 5Y-0.93%
F-Score6
Asset Turnover0.58
Health
Industry RankSector Rank
Debt/Equity 0.17
Debt/FCF N/A
Debt/EBITDA 3.19
Cap/Depr 155.07%
Cap/Sales 5.53%
Interest Coverage 250
Cash Conversion 26.79%
Profit Quality N/A
Current Ratio 2.84
Quick Ratio 2.26
Altman-Z 6.65
F-Score6
WACC10.12%
ROIC/WACC0.15
Cap/Depr(3y)150.37%
Cap/Depr(5y)155.59%
Cap/Sales(3y)5.08%
Cap/Sales(5y)5.15%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)13.64%
EPS 3Y15.26%
EPS 5Y7.58%
EPS Q2Q%9.09%
EPS Next Y6.58%
EPS Next 2Y21.1%
EPS Next 3Y19.15%
EPS Next 5Y25.15%
Revenue 1Y (TTM)7.32%
Revenue growth 3Y11.88%
Revenue growth 5Y9.63%
Sales Q2Q%9.16%
Revenue Next Year12.71%
Revenue Next 2Y14.27%
Revenue Next 3Y14.23%
Revenue Next 5Y13.74%
EBIT growth 1Y-14.47%
EBIT growth 3Y3.47%
EBIT growth 5Y-4.4%
EBIT Next Year285.77%
EBIT Next 3Y79.26%
EBIT Next 5Y53.19%
FCF growth 1Y48.31%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y145.41%
OCF growth 3Y17.29%
OCF growth 5Y10.62%