Advertisement
U.S. markets closed
  • S&P 500

    5,254.35
    +5.86 (+0.11%)
     
  • Dow 30

    39,807.37
    +47.29 (+0.12%)
     
  • Nasdaq

    16,379.46
    -20.06 (-0.12%)
     
  • Russell 2000

    2,124.55
    +10.20 (+0.48%)
     
  • Crude Oil

    83.11
    +1.76 (+2.16%)
     
  • Gold

    2,254.80
    +42.10 (+1.90%)
     
  • Silver

    25.10
    +0.35 (+1.41%)
     
  • EUR/USD

    1.0793
    -0.0036 (-0.33%)
     
  • 10-Yr Bond

    4.2060
    +0.0100 (+0.24%)
     
  • GBP/USD

    1.2621
    -0.0017 (-0.14%)
     
  • USD/JPY

    151.3810
    +0.1350 (+0.09%)
     
  • Bitcoin USD

    70,783.22
    +1,740.12 (+2.52%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • FTSE 100

    7,952.62
    +20.64 (+0.26%)
     
  • Nikkei 225

    40,168.07
    -594.66 (-1.46%)
     

Kratos Defense & Security Solutions (NASDAQ:KTOS) adds US$73m to market cap in the past 7 days, though investors from three years ago are still down 20%

While not a mind-blowing move, it is good to see that the Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) share price has gained 14% in the last three months. But that doesn't help the fact that the three year return is less impressive. In fact, the share price is down 20% in the last three years, falling well short of the market return.

While the last three years has been tough for Kratos Defense & Security Solutions shareholders, this past week has shown signs of promise. So let's look at the longer term fundamentals and see if they've been the driver of the negative returns.

View our latest analysis for Kratos Defense & Security Solutions

Kratos Defense & Security Solutions wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. When a company doesn't make profits, we'd generally expect to see good revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

In the last three years, Kratos Defense & Security Solutions saw its revenue grow by 8.4% per year, compound. That's a pretty good rate of top-line growth. Shareholders have endured a share price decline of 6% per year. This implies the market had higher expectations of Kratos Defense & Security Solutions. However, that's in the past now, and it's the future is more important - and the future looks brighter (based on revenue, anyway).

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

earnings-and-revenue-growth
earnings-and-revenue-growth

We consider it positive that insiders have made significant purchases in the last year. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. So we recommend checking out this free report showing consensus forecasts

A Different Perspective

It's good to see that Kratos Defense & Security Solutions has rewarded shareholders with a total shareholder return of 4.5% in the last twelve months. That's better than the annualised return of 3% over half a decade, implying that the company is doing better recently. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. It's always interesting to track share price performance over the longer term. But to understand Kratos Defense & Security Solutions better, we need to consider many other factors. Take risks, for example - Kratos Defense & Security Solutions has 3 warning signs we think you should be aware of.

Kratos Defense & Security Solutions is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on American exchanges.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

Join A Paid User Research Session
You’ll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here

Advertisement