A Business at a Glance
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KRATOS DEFENSE & SECURITY SOLUTIONS, INC.
KTOS
$8.0B
Mkt Cap
$47.35
-4.23%
KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS) has a current P/E ratio of 364.2, compared to its historical median P/E of 41.6. The stock is currently considered Expensive based on its historical valuation range.
KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS) has a 5-year average return on invested capital (ROIC) of 1.2%. This is below average and may indicate limited pricing power.
KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS) has a market capitalization of $8.9B. It is classified as a mid-cap stock.
KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS) does not currently pay a regular dividend.
Based on historical P/E analysis, KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS) appears expensive. The current P/E of 364.2 is 776% above its historical median of 41.6. The estimated fair value CAGR (P/E method) is -13.9%.
KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS) operates in the Guided Missiles & Space Vehicles & Parts industry, within the Industrials sector.
Kratos is a defense and national security technology company that designs, manufactures, and delivers military-grade hardware, software, and systems across multiple segments including virtualized ground systems for satellites and space vehicles with command & control and telemetry tracking software, jet-powered unmanned aerial systems and hypersonic vehicles, propulsion systems for drones and missiles, microwave electronic products for radar and defense applications, and virtual and augmented reality training systems. The company operates on an affordability-focused business model emphasizing proven technology over unproven approaches, with internally funded research and development enabling rapid time-to-market and low-cost manufacturing at scale; unit economics are characterized by high-margin software and products combined with capital-intensive manufacturing facilities that generate leverage as production volumes increase. Kratos distributes its solutions primarily through direct sales to the U.S. Department of Defense and its allies, as well as through partnerships with large traditional prime system integrators including Northrop Grumman, Lockheed Martin, and RTX, with growing international presence particularly in Israel and emerging opportunities in Europe and the Pacific. The company's competitive differentiation lies in its design-for-manufacturability approach, scarcity of qualified capabilities in military-grade hardware production, and portfolio of first-to-market products such as the Valkyrie collaborative combat aircraft, Zeus solid rocket motors, and OpenSpace satellite software, positioning it as a disruptive innovator in a consolidating defense industrial base. Kratos serves U.S. national security customers, allied governments, and commercial entities, with geographic operations spanning the United States, Israel, and international partnerships, supported by a record backlog and expanding opportunity pipeline reflecting generational recapitalization of global defense systems.
【Defense spending acceleration driving growth】 Management expects accelerating revenue and profitability growth throughout 2026 and into 2027, supported by increased federal defense appropriations including the $156 billion reconciliation bill enacted in July 2025 and projected $1.5 trillion in fiscal 2027 national security spending. The company anticipates approximately 100 basis points of EBITDA margin expansion for both 2026 over 2025 and 2027 over 2026, driven by increasing production volumes, leverage on fixed manufacturing costs, and mix of higher-margin products and software. Key growth drivers include ramp-up of hypersonic systems production, small jet engine low-rate initial production beginning in the second half of 2026 with planned production of several thousand engines in 2027, Valkyrie collaborative combat aircraft production scaling to approximately 40 aircraft annually by early 2028, and space and satellite business expansion particularly through OpenSpace software deliveries. Management emphasizes that multiple new manufacturing facilities including hypersonic integration, jet engine production, and solid rocket motor facilities are expected to come online during 2026 and 2027, with the company positioned to address significant and growing demand from a limited pool of qualified defense technology providers.
| Metric | Target | Period |
|---|---|---|
| Revenue | $1.7 billion–$1.76 billion | FY2026 |
| Hypersonic Revenue | approximately $400 million | 2026 |
| Hypersonic Revenue | approximately $700 million | 2027 |
| Prometheus Joint Venture Investment | approximately $50 million | 2026 |
Revenue (FY2026): “Our updated full year 2026 revenue guidance of $1.7 billion-$1.76 billion includes the estimated contribution from the Orbit acquisitions and includes an estimated organic revenue growth rate of 15%-19% over 2025 actual performance.”
Hypersonic Revenue (2026): “We are expecting to approximately double Kratos' hypersonic franchise revenues in 2026 over 2025, up to approximately $400 million”
Hypersonic Revenue (2027): “and then potentially increase over 75% again in 2027, up to approximately $700 million.”
Prometheus Joint Venture Investment (2026): “Additional forecasted investments in 2026 include our funding of the Prometheus joint venture established last year, which we estimate will occur ratably throughout 2026 for an aggregate for the year of approximately $50 million.”
Generated solely from the company's own reports listed below — not from third-party data. Hallucination risk is low. · Sources: 10-K, Q4 FY2025 Earnings Call, Q3 FY2025 Earnings Call, Q2 FY2025 Earnings Call, Q1 FY2025 Earnings Call
| Metric | TTM | FY2025 | FY2024 | FY2023 | FY2022 | FY2021 |
|---|---|---|---|---|---|---|
| Revenue | 1.4B | 1.3B | 1.1B | 1.0B | 898M | 812M |
| Net Income | 29M | 22M | 16M | -8.9M | -37M | -2.0M |
| EPS | $0.17 | $0.13 | $0.11 | $-0.07 | $-0.29 | $-0.02 |
| Free Cash Flow | -133M | -137M | -8.5M | 13M | -71M | -11M |
| ROIC | 0.9% | 1.2% | 1.5% | 1.6% | -0.3% | 1.9% |
| Gross Margin | 22.9% | 22.9% | 25.3% | 25.9% | 25.2% | 27.7% |
| Debt/Equity | 0.04 | 0.03 | 0.16 | 0.28 | 0.32 | 0.36 |
| Dividends/Share | $0.00 | - | - | - | - | - |
| Operating Income | 24M | 26M | 29M | 31M | -2.9M | 28M |
| Operating Margin | 1.7% | 1.9% | 2.6% | 3.0% | -0.3% | 3.4% |
| ROE | 0.9% | 1.3% | 1.4% | -0.9% | -3.9% | -0.2% |
| Shares Outstanding | 187M | 169M | 148M | 127M | 127M | 100M |
| Metric | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Income Statement | |||||||||||||
| Revenue | 763M | 657M | 669M | 752M | 618M | 718M | 748M | 812M | 898M | 1.0B | 1.1B | 1.3B | 1.4B |
| Gross Margin | 23.5% | 24.6% | 18.0% | 21.0% | 27.5% | 26.5% | 27.2% | 27.7% | 25.2% | 25.9% | 25.3% | 22.9% | 22.9% |
| R&D | 19M | 16M | 14M | 18M | 16M | 18M | 27M | 35M | 39M | 38M | 40M | 40M | 41M |
| SG&A | 154M | 151M | 115M | 127M | 120M | 131M | 145M | 160M | 183M | 199M | 217M | 240M | 256M |
| EBIT | 5.3M | -4.5M | -18M | -12M | 31M | 38M | 29M | 28M | -2.9M | 31M | 29M | 26M | 24M |
| Op. Margin | 0.7% | -0.7% | -2.7% | -1.6% | 4.9% | 5.3% | 3.9% | 3.4% | -0.3% | 3.0% | 2.6% | 1.9% | 1.7% |
| Net Income | -78M | 20M | -61M | -43M | -3.5M | 13M | 80M | -2.0M | -37M | -8.9M | 16M | 22M | 29M |
| Net Margin | -10.2% | 3.0% | -9.0% | -5.7% | -0.6% | 1.7% | 10.6% | -0.2% | -4.1% | -0.9% | 1.4% | 1.6% | 2.1% |
| Non-Recurring | 0 | 0 | 9.1M | 0 | 0 | 0 | 0 | 0 | 14M | 1.8M | 6.4M | 0 | 0 |
| Returns on Capital | |||||||||||||
| ROIC | 0.6% | 2.6% | -2.7% | -1.8% | 2.8% | 3.8% | 3.7% | 1.9% | -0.3% | 1.6% | 1.5% | 1.2% | 0.9% |
| ROE | -30.0% | 8.3% | -22.8% | -10.8% | -0.7% | 2.3% | 10.6% | -0.2% | -3.9% | -0.9% | 1.4% | 1.3% | 0.9% |
| ROA | -6.6% | 1.9% | -6.5% | -4.3% | -0.3% | 1.1% | 5.8% | -0.1% | -2.3% | -0.6% | 0.9% | 1.0% | 0.7% |
| Cash Flow | |||||||||||||
| Op. Cash Flow | 2.5M | -30M | -15M | -27M | 18M | 29M | 45M | 35M | -26M | 65M | 50M | -42M | -40M |
| Free Cash Flow | -9.1M | -41M | -24M | -53M | -4.5M | 2.6M | 8.8M | -11M | -71M | 13M | -8.5M | -137M | -133M |
| Owner Earnings | -33M | -61M | -42M | -57M | -7.0M | -5.5M | -900K | -16M | -83M | 6.7M | -20M | -125M | -136M |
| CapEx | 12M | 11M | 9.0M | 26M | 23M | 26M | 36M | 47M | 45M | 52M | 58M | 95M | 93M |
| Maint. CapEx | 32M | 26M | 23M | 22M | 18M | 23M | 25M | 26M | 31M | 33M | 40M | 47M | 54M |
| Growth CapEx | 0 | 0 | 0 | 3.9M | 4.7M | 2.9M | 11M | 21M | 15M | 19M | 18M | 48M | 39M |
| D&A | 32M | 26M | 23M | 22M | 18M | 23M | 25M | 26M | 31M | 33M | 40M | 47M | 54M |
| CapEx/OCF | 464.0% | N/A | N/A | N/A | 124.9% | 91.0% | 80.3% | 131.7% | N/A | 80.4% | 117.1% | N/A | 0.0% |
| Capital Allocation | |||||||||||||
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Dividend Yield | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A |
| Share Buybacks | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Buyback Yield | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | 0.0% |
| Stock-Based Comp | 3.6M | 6.1M | 5.1M | 7.8M | 7.2M | 11M | 21M | 26M | 26M | 25M | 30M | 36M | 42M |
| Debt Repayment | 662M | 175M | 14M | 449M | 0 | 0 | 600K | 5.1M | 43M | 101M | 53M | 185M | 185M |
| Balance Sheet | |||||||||||||
| Net Debt | 623M | 417M | 363M | 164M | 112M | 171M | -31M | -8.7M | 222M | 198M | -112M | -511M | -1.3B |
| Cash & Equiv. | 34M | 29M | 69M | 131M | 183M | 173M | 381M | 349M | 81M | 73M | 329M | 561M | 1.5B |
| Long-Term Debt | 614M | 444M | 431M | 294M | 294M | 295M | 301M | 297M | 250M | 219M | 175M | 0 | 132M |
| Debt/Equity | 2.93 | 1.75 | 1.56 | 0.58 | 0.57 | 0.60 | 0.38 | 0.36 | 0.32 | 0.28 | 0.16 | 0.03 | 0.04 |
| Interest Coverage | 0.1 | -0.1 | -0.5 | -0.4 | 1.4 | 1.6 | 1.2 | 1.2 | -0.2 | 1.4 | 1.9 | 6.2 | 4.6 |
| Equity | 224M | 254M | 276M | 511M | 519M | 574M | 925M | 945M | 936M | 976M | 1.4B | 2.0B | 3.4B |
| Total Assets | 1.1B | 903M | 949M | 1.0B | 1.0B | 1.2B | 1.6B | 1.6B | 1.6B | 1.6B | 2.0B | 2.5B | 4.0B |
| Total Liabilities | 907M | 649M | 672M | 513M | 491M | 597M | 623M | 629M | 604M | 634M | 598M | 471M | 633M |
| Intangibles | 50M | 37M | 33M | 22M | 16M | 40M | 43M | 43M | 55M | 62M | 54M | 54M | 220M |
| Retained Earnings | -637M | -618M | -678M | -721M | -725M | -712M | -632M | -634M | -671M | -680M | -664M | -642M | -630M |
| Working Capital | 147M | 148M | 177M | 283M | 330M | 340M | 567M | 537M | 348M | 302M | 575M | 952M | 1.9B |
| Current Assets | 373M | 320M | 373M | 471M | 495M | 522M | 765M | 758M | 583M | 594M | 872M | 1.3B | 2.3B |
| Current Liabilities | 226M | 172M | 197M | 189M | 165M | 183M | 198M | 221M | 234M | 293M | 297M | 311M | 411M |
| Per Share Data | |||||||||||||
| EPS | -1.35 | 0.34 | -0.99 | -0.48 | -0.03 | 0.11 | 0.67 | -0.02 | -0.29 | -0.07 | 0.11 | 0.13 | 0.17 |
| Owner EPS | -0.58 | -1.05 | -0.69 | -0.64 | -0.06 | -0.05 | -0.01 | -0.16 | -0.65 | 0.05 | -0.14 | -0.74 | -0.72 |
| Book Value | 3.88 | 4.37 | 4.52 | 5.75 | 4.45 | 5.05 | 7.79 | 9.45 | 7.36 | 7.68 | 9.13 | 11.80 | 18.20 |
| Cash Flow/Share | 0.04 | -0.51 | -0.24 | -0.30 | 0.16 | 0.25 | 0.38 | 0.35 | -0.20 | 0.51 | 0.34 | -0.25 | 0.44 |
| Dividends/Share | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | 0.00 |
| Shares Out. | 57.8M | 58.2M | 61.1M | 89.0M | 116.7M | 113.6M | 118.8M | 100.0M | 127.2M | 127.1M | 148.2M | 169.2M | 187.4M |
| Valuation | |||||||||||||
| P/E Ratio | N/A | 11.8 | N/A | N/A | N/A | 161.5 | 41.6 | N/A | N/A | N/A | 241.1 | 597.7 | 283.2 |
| P/FCF | N/A | N/A | N/A | N/A | N/A | 776.7 | 376.0 | N/A | N/A | 204.5 | N/A | N/A | N/A |
| EV/EBIT | 159.3 | N/A | N/A | N/A | 50.3 | 53.1 | 98.9 | 57.3 | N/A | 88.2 | 120.4 | 471.9 | 318.4 |
| Price/Book | 1.3 | 0.9 | 1.7 | 1.8 | 3.1 | 3.5 | 3.6 | 2.1 | 1.3 | 2.7 | 2.9 | 6.6 | 2.6 |
| Price/Sales | 0.5 | 0.5 | 0.5 | 1.5 | 2.3 | 2.9 | 2.9 | 3.1 | 2.0 | 1.8 | 2.8 | 6.7 | 6.3 |
| FCF Yield | -3.1% | -17.6% | -5.1% | -5.6% | -0.3% | 0.1% | 0.3% | -0.6% | -5.8% | 0.5% | -0.2% | -1.0% | -1.5% |
| Market Cap | 295M | 234M | 459M | 946M | 1.6B | 2.0B | 3.3B | 2.0B | 1.2B | 2.6B | 3.9B | 13.1B | 8.9B |
| Avg. Price | 7.17 | 5.21 | 5.16 | 10.28 | 12.27 | 18.53 | 18.31 | 25.14 | 14.37 | 14.62 | 21.25 | 53.12 | 47.35 |
| Year-End Price | 5.10 | 4.01 | 7.51 | 10.63 | 13.75 | 17.77 | 27.85 | 19.57 | 9.65 | 20.59 | 26.52 | 77.70 | 47.35 |
KRATOS DEFENSE & SECURITY SOLUTIONS, INC. passes 1 of 9 quality checks, indicating weak fundamentals.
KRATOS DEFENSE & SECURITY SOLUTIONS, INC. trades at 364.2x trailing earnings, compared to its 15-year median P/E of 41.6x, suggesting it is currently Expensive relative to its historical range. The company's 5-year average ROIC is 1.2% with a gross margin of 25.4%. At current prices, the estimated annualized return to fair value is -13.9%.
KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS) reported annual revenue of $1.3 billion in its most recent fiscal year, based on SEC EDGAR filings.
KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS) has a net profit margin of 1.6%. This is a modest margin.
KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS) generated $-137 million in free cash flow in its most recent fiscal year. Negative free cash flow may indicate heavy investment or operational challenges.
KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS) has a debt-to-equity ratio of 0.03. This indicates a conservatively financed balance sheet.
KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS) reported earnings per share (EPS) of $0.13 in its most recent fiscal year.
KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS) has a return on equity (ROE) of 1.3%. This indicates moderate shareholder returns.
KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS) has a 5-year average gross margin of 25.4%. This lower margin is typical of capital-intensive or commodity businesses.
The Ledger Terminal provides 16 years of financial data for KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS), sourced directly from SEC EDGAR filings. This includes income statements, balance sheets, cash flow statements, and key financial ratios.
KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS) has a book value per share of $11.80, based on its most recent annual SEC filing.
Based on recent SEC filings and earnings disclosures, Management expects accelerating revenue and profitability growth throughout 2026 and into 2027, supported by increased federal defense appropriations including the $156 billion reconciliation bill enacted in July 2025 and projected $1.5 trillion in fiscal 2027 national security spending. The company anticipates approximately 100 basis points of EBITDA margin expansion for both 2026 over 2025 and 2027 over 2026, driven by increasing production volumes, leverage on fixed manufacturing costs, and mix of higher-margin products and software. Key growth drivers include ramp-up of hypersonic systems production, small jet engine low-rate initial production beginning in the second half of 2026 with planned production of several thousand engines in 2027, Valkyrie collaborative combat aircraft production scaling to approximately 40 aircraft annually by early 2028, and space and satellite business expansion particularly through OpenSpace software deliveries. Management emphasizes that multiple new manufacturing facilities including hypersonic integration, jet engine production, and solid rocket motor facilities are expected to come online during 2026 and 2027, with the company positioned to address significant and growing demand from a limited pool of qualified defense technology providers.
Based on recent SEC filings and earnings calls, KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS) has provided the following forward guidance: Revenue: $1.7 billion–$1.76 billion (FY2026); Hypersonic Revenue: approximately $400 million (2026); Hypersonic Revenue: approximately $700 million (2027); Prometheus Joint Venture Investment: approximately $50 million (2026).