SAN DIEGO—Steven S. Fendley, President of the U.S. Division at Kratos Defense (NASDAQ:KTOS) & Security Solutions, Inc. (NASDAQ:KTOS), recently sold 7,000 shares of the company's common stock. The shares were sold at a weighted average price of $24.0105, resulting in a total transaction value of $168,073. This sale was conducted as part of a 10b5-1 trading plan that Fendley adopted on May 20, 2024.
Following the transaction, Fendley holds 356,414 shares, which includes approximately 1,902 shares through Kratos' 401(k) Plan. The shares were sold in multiple transactions at prices ranging from $23.85 to $24.25.
In other recent news, Kratos Defense & Security Solutions reported Q2 revenues of $300.1 million and an adjusted EBITDA of $29.9 million. The company also secured a $45 million contract for a new satellite system and a $79.9 million contract from the U.S. Air Force for unmanned aerial target systems. However, board member Daniel Hagen has resigned, with the reasons behind his departure remaining unspecified.
B.Riley downgraded Kratos stock from Buy to Neutral, citing limited near-term upside potential, despite the firm's long-term optimism and the company's substantial $12 billion bid and proposal pipeline. Truist Securities and Baird upgraded their price targets for Kratos to $27 and $35 respectively, while BTIG maintained a neutral rating, focusing on the potential financial impact of Kratos' involvement in the Collaborative Combat Aircraft tactical drone program.
Kratos has completed ground tests for a new turbofan engine in partnership with GE Aerospace and plans to expand its drone manufacturing capabilities. Furthermore, Shield AI demonstrated its Hivemind AI pilot's ability to autonomously control multiple Kratos MQM-178 Firejet aircraft. These are the recent developments in Kratos Defense & Security Solutions' ongoing operations.
InvestingPro Insights
While Steven S. Fendley's recent stock sale might raise eyebrows, a deeper look at Kratos Defense & Security Solutions' financials reveals a more nuanced picture. According to InvestingPro data, Kratos boasts a market capitalization of $3.56 billion, reflecting its significant presence in the defense sector. The company's revenue growth is noteworthy, with a 16.46% increase over the last twelve months as of Q2 2024, reaching $1.13 billion.
InvestingPro Tips highlight that Kratos holds more cash than debt on its balance sheet, indicating financial stability. This aligns with another tip stating that the company's liquid assets exceed short-term obligations, potentially explaining why insiders like Fendley might feel comfortable selling shares without signaling financial distress.
However, investors should note that Kratos is trading at a high earnings multiple, with a P/E ratio of 328.75. This suggests that the market has high growth expectations for the company, which is supported by the InvestingPro Tip indicating that net income is expected to grow this year.
For those seeking a more comprehensive analysis, InvestingPro offers 11 additional tips on Kratos, providing a deeper understanding of the company's financial health and market position.
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