Kratos Defense & Security Solutions (NASDAQ: KTOS) and Triumph Group (NYSE:TGI) are both small-cap industrials companies, but which is the superior stock? We will compare the two companies based on the strength of their profitability, valuation, earnings, analyst recommendations, dividends, institutional ownership and risk.
This table compares Kratos Defense & Security Solutions and Triumph Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Kratos Defense & Security Solutions||-5.68%||0.73%||0.31%|
This is a summary of recent ratings for Kratos Defense & Security Solutions and Triumph Group, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Kratos Defense & Security Solutions||0||4||5||0||2.56|
Kratos Defense & Security Solutions presently has a consensus price target of $13.44, suggesting a potential upside of 17.93%. Triumph Group has a consensus price target of $32.89, suggesting a potential upside of 16.42%. Given Kratos Defense & Security Solutions’ stronger consensus rating and higher possible upside, equities analysts clearly believe Kratos Defense & Security Solutions is more favorable than Triumph Group.
Volatility and Risk
Kratos Defense & Security Solutions has a beta of 1.84, meaning that its stock price is 84% more volatile than the S&P 500. Comparatively, Triumph Group has a beta of 1.69, meaning that its stock price is 69% more volatile than the S&P 500.
Earnings & Valuation
This table compares Kratos Defense & Security Solutions and Triumph Group’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Kratos Defense & Security Solutions||$751.90 million||1.57||-$42.70 million||($0.85)||-13.41|
|Triumph Group||$3.53 billion||0.40||-$42.95 million||($5.46)||-5.17|
Kratos Defense & Security Solutions has higher earnings, but lower revenue than Triumph Group. Kratos Defense & Security Solutions is trading at a lower price-to-earnings ratio than Triumph Group, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
75.0% of Kratos Defense & Security Solutions shares are owned by institutional investors. 17.9% of Kratos Defense & Security Solutions shares are owned by insiders. Comparatively, 2.8% of Triumph Group shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Triumph Group pays an annual dividend of $0.16 per share and has a dividend yield of 0.6%. Kratos Defense & Security Solutions does not pay a dividend. Triumph Group pays out -2.9% of its earnings in the form of a dividend.
Kratos Defense & Security Solutions beats Triumph Group on 10 of the 16 factors compared between the two stocks.
About Kratos Defense & Security Solutions
Kratos Defense & Security Solutions, Inc. is a technology, intellectual property and proprietary product and solution company focused on the United States and its allies’ national security. The Kratos Government Solutions segment includes the operations of Defense Rocket Support Services, Microwave Electronics Division, Technical and Training Solutions, and Modular Systems, which provide technology-based defense solutions, involving products and services, with the focus relating to the nation’s Command, Control, Communications, Computing, Combat Systems, Intelligence, Surveillance and Reconnaissance requirements. The Unmanned Systems segment includes its unmanned aerial, ground, seaborne and command, control and communications system business. The Public Safety & Security segment provides integrated solutions for homeland security, public safety, critical infrastructure, and security and surveillance systems for government and commercial applications.
About Triumph Group
Triumph Group, Inc. designs, engineers, manufactures, repairs, overhauls and distributes a portfolio of aircraft components, accessories, subassemblies and systems. The Company offers a range of products and services to the aerospace industry through three segments: Triumph Aerostructures Group, whose companies are engaged in the design, manufacture, assembly and integration of metallic and composite aerostructures and structural components for the aerospace original equipment manufacturer (OEM) market; Triumph Aerospace Systems Group, whose companies design, engineer and manufacture a range of build-to-print components, assemblies and systems also for the OEM market, and Triumph Aftermarket Services Group, whose companies serve aircraft fleets, such as commercial airlines, the United States military and cargo carriers, through the maintenance, repair and overhaul (MRO) of aircraft components and accessories manufactured by third parties.
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