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Kratos (KTOS) Joins S&P MidCap 400 and Expands Global Drone Partnerships—Is Its Growth Trajectory Evolving?

Simply Wall St · 09/23 15:45
  • Kratos Defense & Security Solutions was recently added to the S&P MidCap 400 Index and, in partnership with Taiwan’s National Chung-Shan Institute of Science and Technology (NCSIST), unveiled the advanced Mighty Hornet IV Attack UAV at the Taipei Aerospace & Defense Technology Exhibition.
  • This dual development highlights Kratos’ increasing market recognition and international expansion opportunities in unmanned military technology.
  • We'll now explore how the S&P MidCap 400 inclusion and international drone partnership could influence Kratos' investment outlook.

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Kratos Defense & Security Solutions Investment Narrative Recap

Kratos Defense & Security Solutions appeals to investors who see long-term growth in unmanned systems, propelled by rising defense budgets and expanding global alliances. While the S&P MidCap 400 inclusion and Taiwan partnership spotlight Kratos' momentum, the most important short-term catalyst remains timely contract wins and production scale for its high-profile tactical drones, whereas risks tied to outsized internal investment, especially ahead of full contract awards, may still apply without material near-term change from these recent announcements.

Of the recent announcements, the unveiling of the Mighty Hornet IV UAV at TADTE 2025 stands out, underscoring Kratos' push to convert technology edge and new partnerships into contract momentum. This event ties directly to the catalyst of ramping international orders, where execution speed and sustained demand will be crucial as the company's investment in production and inventory scales up.

In contrast, investors should also weigh the risk that heavy working capital commitments and CapEx may pressure free cash flow if large contract awards are delayed or fail to materialize...

Read the full narrative on Kratos Defense & Security Solutions (it's free!)

Kratos Defense & Security Solutions is projected to reach $1.9 billion in revenue and $101.6 million in earnings by 2028. This outlook assumes annual revenue growth of 17.0% and an earnings increase of $87.1 million from the current $14.5 million.

Uncover how Kratos Defense & Security Solutions' forecasts yield a $71.21 fair value, a 12% downside to its current price.

Exploring Other Perspectives

KTOS Community Fair Values as at Sep 2025
KTOS Community Fair Values as at Sep 2025

Nine members of the Simply Wall St Community provide fair value estimates ranging from just US$9.24 to as high as US$78 per share. While contract momentum is a key catalyst, these wide-ranging investor views reflect how future performance could sharply diverge, explore these varied perspectives to inform your outlook.

Explore 9 other fair value estimates on Kratos Defense & Security Solutions - why the stock might be worth as much as $78.00!

Build Your Own Kratos Defense & Security Solutions Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

  • A great starting point for your Kratos Defense & Security Solutions research is our analysis highlighting 2 key rewards that could impact your investment decision.
  • Our free Kratos Defense & Security Solutions research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Kratos Defense & Security Solutions' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.