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Kratos Defense Shares Fall as Post-Earnings Cash Burn and Segment Weakness Weigh on Sentiment

Investivoq PriceTracker

Kratos Defense & Security Solutions (KTOS) is down 5.3% today. Here is some analysis on what might have caused this price movement.

Analysis: The most likely driver is continued post-earnings pressure after investors looked past strong revenue growth and focused on profitability, cash usage, and softer trends in the unmanned systems business. This could also be because a recent analyst price-target cut added to a more cautious tone around the shares.

Details:

  • Kratos posted third-quarter 2026 revenue of $471.8 million, adjusted EPS of $0.24, a 2.2-to-1 consolidated book-to-bill ratio, and raised full-year 2026 guidance while also giving an initial 2027 outlook.
  • Despite that growth, the quarter still included a GAAP operating loss of $4.9 million, near break-even net income, and free cash flow used in operations of $29.4 million after elevated capital spending.
  • The unmanned systems segment was a weak spot: revenue fell year over year, operating results slipped to a loss, book-to-bill was below 1.0, and backlog edged down from the prior quarter.
  • Recent company announcements highlighted new space and launch-related progress, including an offshore launch platform agreement and a U.S. Space Force program milestone, which suggests today’s drop is more likely tied to earnings-quality concerns and valuation reset than to a lack of business activity.

    • Sources:

    SEC, Kratos Defense, MarketBeat

    Disclaimer: This price movement analysis was generated with the help of AI. Please double-check the information provided for mistakes.

    $KTOS Insider Trading Activity

    KTOS Insider Trades

    $KTOS insiders have traded $KTOS stock on the open market 69 times in the past 6 months. Of those trades, 0 have been purchases and 69 have been sales.

    Here’s a breakdown of recent trading of $KTOS stock by insiders over the last 6 months:

    • ERIC M DEMARCO (President & CEO) has made 0 purchases and 4 sales selling 300,000 shares for an estimated $19,300,304.
    • STEVEN S. FENDLEY (President, US Division) has made 0 purchases and 9 sales selling 63,000 shares for an estimated $3,500,482.
    • PHILLIP D CARRAI (President, STC Division) has made 0 purchases and 20 sales selling 59,000 shares for an estimated $3,289,369.
    • JONAH ADELMAN (President, ME Division) sold 31,348 shares for an estimated $1,788,625
    • DEANNA H LUND (EVP & CFO) has made 0 purchases and 14 sales selling 29,000 shares for an estimated $1,447,192.
    • SCOT B JARVIS sold 10,000 shares for an estimated $634,961
    • STACEY G ROCK (President, KTT Division) has made 0 purchases and 5 sales selling 8,675 shares for an estimated $495,622.
    • DAVID M CARTER (President, DRSS Division) has made 0 purchases and 6 sales selling 8,000 shares for an estimated $425,417.
    • MARIE MENDOZA (SVP & General Counsel) has made 0 purchases and 7 sales selling 6,039 shares for an estimated $339,429.
    • BRADLEY L BOYD sold 3,000 shares for an estimated $156,240
    • BOBBI DOORENBOS sold 2,500 shares for an estimated $143,225

    To track insider transactions, check out Investivoq's insider trading dashboard. You can access data on insider stock transactions through the Investivoq API insider transaction endpoint.

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    $KTOS Hedge Fund Activity

    We have seen 352 institutional investors add shares of $KTOS stock to their portfolio, and 417 decrease their positions in their most recent quarter.

    Here are some of the largest recent moves:

    • BLACKROCK, INC. removed 7,627,817 shares (-24.1%) from their portfolio in Q2 2026, for an estimated $380,322,955
    • FRANKLIN RESOURCES INC removed 3,210,459 shares (-80.7%) from their portfolio in Q2 2026, for an estimated $160,073,485
    • JERICHO CAPITAL ASSET MANAGEMENT L.P. removed 2,649,578 shares (-100.0%) from their portfolio in Q2 2026, for an estimated $132,107,959
    • INVESCO LTD. removed 2,559,134 shares (-62.6%) from their portfolio in Q3 2026, for an estimated $109,249,430
    • ASCENTIS WEALTH MANAGEMENT, LLC removed 1,841,938 shares (-97.9%) from their portfolio in Q3 2026, for an estimated $78,632,333
    • B&D WHITE CAPITAL COMPANY, LLC added 1,815,370 shares (+21357.3%) to their portfolio in Q3 2026, for an estimated $77,498,145
    • PRICE T ROWE ASSOCIATES INC /MD/ removed 1,772,367 shares (-83.0%) from their portfolio in Q2 2026, for an estimated $88,370,218

    To track hedge funds' stock portfolios, check out Investivoq's institutional holdings dashboard. You can access data on hedge funds moves and 13F filings through the Investivoq API 13F endpoint.

    $KTOS Price Targets

    Multiple analysts have issued price targets for $KTOS recently. We have seen 3 analysts offer price targets for $KTOS in the last 6 months, with a median target of $82.0.

    Here are some recent targets:

    • Sheila Kahyaoglu from Jefferies set a target price of $80.0 on 07/08/2026
    • Sam Brandeis from Wedbush set a target price of $85.0 on 07/01/2026
    • Seth Seifman from JP Morgan set a target price of $82.0 on 06/12/2026

    This article is not financial advice. See Investivoq's disclaimers for more information. Note that there may be inaccuracies due to mistakes in ticker-mapping, and other anomalies.