Kratos Defense & Security Solutions (NASDAQ:KTOS) Trading Down 3% – Should You Sell?

Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS)’s stock price traded down 3% during trading on Friday . The company traded as low as $108.36 and last traded at $110.39. 3,990,463 shares were traded during trading, a decline of 16% from the average session volume of 4,763,854 shares. The stock had previously closed at $113.85.

Trending Headlines about Kratos Defense & Security Solutions

Here are the key news stories impacting Kratos Defense & Security Solutions this week:

• Positive Sentiment: Goldman Sachs reiterated a buy on KTOS, supporting investor confidence in the company’s growth trajectory and helping underpin demand for the shares. Goldman Sachs remains a buy on Kratos Defense & Security Solutions (KTOS)
• Positive Sentiment: Analysts and trade press are pointing to renewed U.S. defense priorities — a sector tailwind that benefits KTOS given its defense contracting exposure and could support higher government spending. 3 Stocks Positioned to Gain From Renewed U.S. Defense Priorities
• Positive Sentiment: Noble Financial raised its FY2026 EPS forecast for KTOS and keeps an Outperform rating — an earnings-upgrade signal that supports a constructive medium-term outlook. Noble Financial raises FY2026 EPS estimate for Kratos (MarketBeat summary)
• Neutral Sentiment: Noble also published a Q1 earnings estimate update — incremental analyst modeling that investors may use to refine near-term expectations but not a major directional catalyst by itself. Q1 Earnings Estimate for KTOS Issued By Noble Financial
• Neutral Sentiment: Piper Sandler initiated coverage of KTOS with a neutral rating (new coverage can increase attention and trading volume but signals neither clear buy nor sell). Piper Sandler initiates coverage of Kratos with neutral recommendation
• Neutral Sentiment: Separately, market commentary is reassessing KTOS valuation after its recent share-price run — useful context for investors sizing positions but not an immediate transaction trigger. Assessing Kratos Valuation After Recent Share Price Surge
• Negative Sentiment: Follow-up coverage noted Piper Sandler’s $99 price target, implying downside from current levels — a concrete figure that may cap upside in the near term and weigh on sentiment. Piper Sandler PT and notes on KTOS
• Negative Sentiment: Articles highlight stretched valuation and suggest options strategies as alternatives — commentary that can prompt profit-taking or caution among growth-oriented investors. Kratos Defense: Stretched Valuation (Seeking Alpha)
• Negative Sentiment: Management remarks in Q4 were portrayed as weighing on sentiment in a fund manager letter — specific execution/communication issues can pressure short-term trading. Management remarks weighed on KTOS in Q4 (InsiderMonkey)

Analyst Ratings Changes

Several equities analysts have recently commented on KTOS shares. KeyCorp began coverage on shares of Kratos Defense & Security Solutions in a research note on Thursday, December 18th. They set an “overweight” rating and a $90.00 price objective for the company. Weiss Ratings reiterated a “hold (c)” rating on shares of Kratos Defense & Security Solutions in a research report on Thursday. Jefferies Financial Group restated a “hold” rating and set a $85.00 target price on shares of Kratos Defense & Security Solutions in a report on Thursday, November 6th. Canaccord Genuity Group raised their price target on Kratos Defense & Security Solutions from $74.00 to $120.00 and gave the stock a “buy” rating in a research note on Thursday, October 9th. Finally, The Goldman Sachs Group lifted their price target on shares of Kratos Defense & Security Solutions from $93.00 to $125.00 and gave the company a “buy” rating in a report on Tuesday. One equities research analyst has rated the stock with a Strong Buy rating, sixteen have issued a Buy rating and five have assigned a Hold rating to the company. According to MarketBeat, the company currently has a consensus rating of “Moderate Buy” and a consensus target price of $93.06.

Kratos Defense & Security Solutions Stock Down 3.0%

The company has a debt-to-equity ratio of 0.04, a quick ratio of 3.68 and a current ratio of 4.30. The stock’s 50-day moving average price is $86.80 and its two-hundred day moving average price is $78.35. The stock has a market capitalization of $18.64 billion, a PE ratio of 849.22 and a beta of 1.09.

Kratos Defense & Security Solutions (NASDAQ:KTOS) last posted its quarterly earnings data on Tuesday, November 4th. The aerospace company reported $0.14 EPS for the quarter, topping the consensus estimate of $0.12 by $0.02. The business had revenue of $347.60 million for the quarter, compared to analyst estimates of $323.01 million. Kratos Defense & Security Solutions had a net margin of 1.56% and a return on equity of 3.14%. Kratos Defense & Security Solutions’s quarterly revenue was up 26.0% on a year-over-year basis. During the same quarter in the previous year, the firm posted $0.11 earnings per share. As a group, analysts expect that Kratos Defense & Security Solutions, Inc. will post 0.31 EPS for the current fiscal year.

Insider Buying and Selling

In other news, insider Stacey G. Rock sold 16,568 shares of the firm’s stock in a transaction on Monday, January 12th. The stock was sold at an average price of $116.74, for a total transaction of $1,934,148.32. Following the completion of the transaction, the insider directly owned 26,487 shares in the company, valued at $3,092,092.38. This trade represents a 38.48% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. Also, Director Scot B. Jarvis sold 5,000 shares of the company’s stock in a transaction dated Thursday, January 15th. The stock was sold at an average price of $120.18, for a total transaction of $600,900.00. Following the completion of the transaction, the director owned 105,417 shares in the company, valued at approximately $12,669,015.06. The trade was a 4.53% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders have sold a total of 911,815 shares of company stock worth $74,226,491 over the last three months. Corporate insiders own 2.37% of the company’s stock.

Institutional Inflows and Outflows

Several hedge funds and other institutional investors have recently made changes to their positions in KTOS. Alliancebernstein L.P. increased its position in shares of Kratos Defense & Security Solutions by 1,389.0% during the third quarter. Alliancebernstein L.P. now owns 2,707,776 shares of the aerospace company’s stock valued at $247,409,000 after acquiring an additional 2,525,921 shares in the last quarter. Rovida Advisors Inc. bought a new position in Kratos Defense & Security Solutions in the second quarter valued at about $82,315,000. Franklin Resources Inc. boosted its position in Kratos Defense & Security Solutions by 29.6% in the second quarter. Franklin Resources Inc. now owns 5,086,494 shares of the aerospace company’s stock worth $236,268,000 after purchasing an additional 1,162,577 shares during the last quarter. Westfield Capital Management Co. LP bought a new stake in shares of Kratos Defense & Security Solutions during the 3rd quarter valued at about $91,901,000. Finally, Allspring Global Investments Holdings LLC purchased a new stake in shares of Kratos Defense & Security Solutions during the 2nd quarter valued at about $37,475,000. Institutional investors own 75.92% of the company’s stock.

Kratos Defense & Security Solutions Company Profile

Kratos Defense & Security Solutions, Inc (NASDAQ: KTOS) is a technology-driven company that specializes in national security and defense solutions for government and military customers. The firm’s core capabilities span unmanned systems, satellite communications, missile defense, cyber security, and directed-energy weapons. Through its integrated approach, Kratos delivers mission-critical products and services designed to enhance operational readiness and support force modernization initiatives.

In the unmanned systems arena, Kratos develops high-performance aerial platforms used as target drones, low-cost attritable aircraft and experimental stealth demonstrators.