Kratos Defense & Security stock price target doubled by Raymond James

Investing.com - Raymond (NSE:RYMD) James raised its price target on Kratos Defense & Security (NASDAQ:KTOS) to $80.00 from $40.00 on Thursday, maintaining a Strong Buy rating following the company’s second-quarter earnings beat.

The defense contractor, now commanding a market capitalization of $10.73 billion, reported second-quarter revenue of $351.5 million, exceeding analyst expectations of $306.5 million by 15%. The company achieved organic growth of 15.2% compared to flat growth expectations, while adjusted EBITDA reached $28.3 million versus forecasts of $24 million. InvestingPro data reveals 17 additional key insights about KTOS’s financial health and growth prospects.

Kratos raised its full-year revenue guidance to $1.29-1.31 billion, representing a 2.2% increase from previous projections. The company’s record pipeline now stands at $13 billion, which Raymond James notes has "substantially covered" the prior base case of 13-15% growth in 2026.

Raymond James projects Kratos will reach $2 billion in revenue by 2027, reflecting accelerated growth from approximately 10% over the past three years to over 20% annually through the next five years. The firm expects improved margins through scale and production work.

The investment bank highlighted Kratos’ involvement in critical defense modernization areas including air defense, hypersonics, drones, engines, and space technologies, which it believes positions the company for long-term growth regardless of future administrations.

In other recent news, Kratos Defense & Security Solutions reported its second-quarter 2025 financial results, exceeding analysts’ expectations. The company achieved an adjusted earnings per share (EPS) of $0.11, surpassing the consensus estimate of $0.10. Revenue for the quarter reached $352 million, marking a 15% organic growth and exceeding consensus expectations by 15%. Analysts had forecasted revenue of $307.1 million, making Kratos’ performance notably stronger than anticipated. In response to these results, RBC Capital raised its price target for Kratos Defense & Security from $50 to $65, maintaining an Outperform rating on the stock. This adjustment reflects the positive outlook from analysts at RBC Capital. These developments highlight Kratos’ strong financial performance and the confidence analysts have in the company’s future prospects.

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