Kratos Defense & Security Solutions, Inc. (Nasdaq: KTOS) Announces Deal and Shares Jump

Kratos Defense & Security Solutions, Inc. Nasdaq: KTOS

Kratos Defense & Security Solutions, Inc. (Nasdaq: KTOS), a leading national security solutions provider, announced today that the Cyprus Telecommunications Authority (Cyta), a major international telecommunications hub in the Eastern Mediterranean, has selected Kratos’ end-to-end network management suite of products to support its expanding satellite ground operations. The news, released after the regular trading session, sent KTOS shares up over 7% on moderate volumes.

There have been critics of Kratos Defense & Security Solutions, Inc. (Nasdaq: KTOS) and they let it be known that they believed KTOS was a screaming short play – that the firm was destined to go into insolvency. However, the market shrugged off those predictions and KTOS shares have been rising since. Then, last week, Jim Cramer of CNBC specifically names Kratos Defense & Security Solutions, Inc. as one of his picks to benefit from any uptick in defense spending.

Kratos Defense & Security Solutions, Inc. (KTOS) is a mid-tier government contractor at the forefront of the Department of Defense’s Third Offset Strategy. Kratos is a leading technology, intellectual property and proprietary product and solution company focused on the United States and its allies’ national security.  Kratos is considered by some to be an industry leader in high performance unmanned aerial drone target systems used to test weapon systems and to train the warfighter, and is a provider of high performance unmanned combat aerial systems for force multiplication and amplification.  Kratos is also an industry leader in satellite communications, microwave electronics, cyber security/warfare, missile defense and combat systems.  Kratos has primarily an engineering and technically oriented work force of approximately 2,800. Substantially all of Kratos’ work is performed on a military base, in a secure facility or at a critical infrastructure location. Kratos’ primary end customers are National Security related agencies.

Kratos Defense & Security Solutions, Inc. (KTOS) sales have been on the decline since they posted a figure of $969.2 million in 2012. In 2015 that figure was just $657.1 million. KTOS shareholders have not experienced positive earnings since 2011 when the loss was $0.86/share and in 2015 the company posted a loss of $0.57/share. Five firms follow Kratos Defense & Security Solutions, Inc. (KTOS). Four analysts rate KTOS shares as a “Strong Buy” and one rates the shares as a “Hold”. Their consensus price target is $9.

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

Ticker Symbol KTOS
Last Price a/o 7:59 PM EST  $                      9.08
Average Volume                    973,900
Market Cap (mlns)  $                  618.71
Sales (mlns) $664.10
Shares Outstanding (mlns) 73.22
Share Float (mlns) 70.46
Shortable Yes
Optionable Yes
Inside Ownership 2.40%
Short Float 9.11%
Short Interest Ratio 6.59
Quarterly Return 35.63%
YTD Return 14.19%
Year Return 170.83%


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Marc has a degree in economics and a MSc. in Finance. Marc worked for global investment firms in Europe and the United States as an analyst, fund manager, and consultant.

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