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Investing.com - Cantor Fitzgerald has reiterated an Overweight rating and $60.00 price target on Kratos Defense & Security (NASDAQ:KTOS), maintaining its positive outlook on the defense technology company.
The firm believes market sentiment is currently underestimating the upside potential and sustainability of Kratos’ growth trajectory, particularly regarding its X-58 drone program expected to enter service. With a market capitalization of $9.92 billion and revenue growth of 7.3% in the last twelve months, investors anticipating the company’s next earnings report on July 31 can access deeper insights through InvestingPro’s comprehensive research report.
Cantor Fitzgerald views the Group 4-5 drone market not as a winner-take-all scenario but as a space where multiple solutions will serve different branch-specific missions, with the X-58 well-positioned as military force structure decisions shift toward attrition-derived outcomes. The company maintains a healthy financial position with a current ratio of 2.84 and operates with moderate debt levels.
The research firm also highlighted Kratos’ potential to expand its role in microwave electronics and munitions markets through its work on higher-value systems and classified programs.
While Cantor Fitzgerald expects the Air Force to dual-source from General Atomics and Anduril for its Collaborative Combat Aircraft program, it anticipates the X-58 will find adoption with service branches that prioritize attrition-lethality frameworks.
In other recent news, Kratos Defense & Security Solutions announced that the U.S. Marine Corps will transition the XQ-58 Valkyrie drone into a Program of Record, moving it into production. This development follows a positive reiteration from Raymond (NSE:RYMD) James, which maintains a Strong Buy rating and a $40.00 price target on Kratos. Additionally, Kratos successfully demonstrated an end-to-end 5G Non-Terrestrial Network, integrating its OpenSpace software with Intelsat’s network, marking a significant step in advancing 5G connectivity. Cantor Fitzgerald reiterated its Overweight rating on Kratos, citing potential catalysts like X-58 scaling and munitions opportunities, with a price target of $60.00. Noble Capital also raised its price target for Kratos to $60.00, highlighting abundant growth opportunities in both defense and commercial sectors. The firm noted that Kratos’ recent capital raise could support these growth prospects. Furthermore, a directive from Defense Secretary Pete Hegseth to increase drone production has positively impacted Kratos and other drone-related stocks.
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