Kratos Defense Shares Surge 45% on New Contract Win
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 10h ago
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Source: Fool
- Stock Surge: Kratos Defense shares jumped 45% this week to $9.46 per share, elevating its market cap to $19 billion, reflecting strong market confidence driven by new contracts and increased defense spending.
- Defense Budget Increase: The U.S. government proposed a significant increase in the defense budget to $1.5 trillion for 2027, up from $1 trillion in 2026, which is expected to create substantial investment opportunities for Kratos in unmanned vehicles and advanced communication systems.
- Contract Win: Kratos secured a new contract with the U.S. Marine Corps to develop unmanned aerial systems, further solidifying its position as a leading supplier of drones for future warfare, which is anticipated to drive revenue growth.
- Revenue Growth Outlook: Kratos reported a 26% year-over-year revenue increase last quarter, with projections of 15%-20% growth in 2026 and 18%-23% in 2027, indicating strong growth potential despite the low-margin nature of the defense industry.
Analyst Views on KTOS
Wall Street analysts forecast KTOS stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for KTOS is 100.69 USD with a low forecast of 80.00 USD and a high forecast of 125.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
13 Analyst Rating
10 Buy
3 Hold
0 Sell
Strong Buy
Current: 104.040
Low
80.00
Averages
100.69
High
125.00
Current: 104.040
Low
80.00
Averages
100.69
High
125.00
About KTOS
Kratos Defense & Security Solutions, Inc. is a technology, products, system and software company addressing the defense, national security, and commercial markets. It operates through two segments: Kratos Government Solutions (KGS) and Unmanned Systems (US). The KGS segment includes its microwave electronic products, space, satellite and cyber, training solutions, command, control, communication, computing, combat, intelligence surveillance and reconnaissance (C5ISR)/modular systems, turbine technologies, and defense and rocket support services operating segments. The US segment consists of its unmanned aerial, unmanned ground, unmanned seaborne and related command, control and communications system businesses. Its KGS and US segments provide products, solutions and services for mission-critical National Security programs. KGS and US customers primarily include National Security-related agencies, the DoD, intelligence agencies and classified agencies, and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
