Stock Traders Purchase High Volume of Kratos Defense & Security Solutions Call Options (NASDAQ:KTOS)

Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) saw some unusual options trading on Thursday. Stock investors purchased 10,959 call options on the stock. This is an increase of 51% compared to the typical daily volume of 7,280 call options.

Key Stories Impacting Kratos Defense & Security Solutions

Here are the key news stories impacting Kratos Defense & Security Solutions this week:

• Positive Sentiment: White House defense focus and Kratos’ endorsement — Kratos publicly praised President Trump’s policy prioritizing reinvestment in defense capabilities over buybacks, which dovetails with proposed big defense spending that would benefit contractors with drone and unmanned systems exposure. Article Link
• Positive Sentiment: High‑profile program pairing — Northrop Grumman was awarded the Marine Corps’ MUX CCA work and will integrate Kratos’ Valkyrie UAS, boosting Kratos’ program visibility and potential upside from collaborative combat aircraft work. Article Link
• Positive Sentiment: Analyst coverage and price‑target momentum — Jones Trading initiated coverage with a buy, and other firms have raised targets recently (Canaccord, BTIG, Stifel), giving investors fresh sell‑side support. This underpins valuation upside expectations. Coverage Summary
• Positive Sentiment: Unusually large call buying — Market data shows a big jump in call option purchases (≈10,959 contracts), indicating speculative/institutional bullish positioning that can amplify intraday moves.
• Positive Sentiment: Social‑media and contract buzz — AI/aggregated social commentary highlights analyst upgrades, rumored ~$30M contract wins and increased attention on Kratos’ drone capabilities, raising investor interest. Quiver Summary
• Neutral Sentiment: Press and market write‑ups provide context — Coverage (MSN, Yahoo, MarketBeat) explains why KTOS is moving (policy, programs, upgrades) but some pieces are retrospective rather than new catalysts. MSN Article
• Negative Sentiment: Insider selling — CEO Eric DeMarco disclosed a large sale (~191,699 shares on Jan 6) and the CFO sold shares recently; large insider disposals can be perceived negatively by some investors. SEC filings: CEO SEC Filing and CFO SEC Filing
• Negative Sentiment: Profitability and cash‑burn concerns — Analysts and commentators note Kratos is growing revenue rapidly but remains unprofitable with margin pressure from fixed‑price contracts and heavy capex, a structural risk for long‑term valuation. Seeking Alpha

Kratos Defense & Security Solutions Stock Up 13.8%

NASDAQ KTOS opened at $104.04 on Friday. Kratos Defense & Security Solutions has a 1-year low of $23.90 and a 1-year high of $112.57. The company has a market capitalization of $17.57 billion, a price-to-earnings ratio of 800.37 and a beta of 1.09. The stock’s 50 day moving average is $77.68 and its two-hundred day moving average is $72.20. The company has a current ratio of 4.30, a quick ratio of 3.68 and a debt-to-equity ratio of 0.04.

Kratos Defense & Security Solutions (NASDAQ:KTOS) last posted its earnings results on Tuesday, November 4th. The aerospace company reported $0.14 EPS for the quarter, topping the consensus estimate of $0.12 by $0.02. Kratos Defense & Security Solutions had a return on equity of 3.14% and a net margin of 1.56%.The business had revenue of $347.60 million during the quarter, compared to the consensus estimate of $323.01 million. During the same quarter last year, the company earned $0.11 EPS. Kratos Defense & Security Solutions’s revenue was up 26.0% on a year-over-year basis. Equities analysts forecast that Kratos Defense & Security Solutions will post 0.31 earnings per share for the current fiscal year.

Analysts Set New Price Targets

A number of equities analysts recently issued reports on KTOS shares. KeyCorp started coverage on shares of Kratos Defense & Security Solutions in a research report on Thursday, December 18th. They set an “overweight” rating and a $90.00 target price on the stock. B. Riley downgraded shares of Kratos Defense & Security Solutions from a “buy” rating to a “neutral” rating and boosted their price objective for the stock from $72.00 to $105.00 in a report on Wednesday, October 8th. Stifel Nicolaus increased their target price on shares of Kratos Defense & Security Solutions from $70.00 to $112.00 and gave the company a “buy” rating in a research note on Wednesday, October 15th. JMP Securities lifted their target price on Kratos Defense & Security Solutions from $70.00 to $105.00 and gave the stock a “market outperform” rating in a research report on Thursday, October 2nd. Finally, BTIG Research upped their price target on Kratos Defense & Security Solutions from $80.00 to $95.00 and gave the company a “buy” rating in a report on Thursday, November 6th. One equities research analyst has rated the stock with a Strong Buy rating, fourteen have issued a Buy rating and six have issued a Hold rating to the company. Based on data from MarketBeat, the company currently has an average rating of “Moderate Buy” and a consensus target price of $82.53.

Insider Buying and Selling

In other Kratos Defense & Security Solutions news, insider Steven S. Fendley sold 7,000 shares of Kratos Defense & Security Solutions stock in a transaction that occurred on Monday, December 29th. The stock was sold at an average price of $76.57, for a total value of $535,990.00. Following the transaction, the insider directly owned 318,435 shares of the company’s stock, valued at $24,382,567.95. The trade was a 2.15% decrease in their position. The sale was disclosed in a filing with the SEC, which is available at the SEC website. Also, insider Stacey G. Rock sold 8,549 shares of the company’s stock in a transaction that occurred on Thursday, December 18th. The stock was sold at an average price of $71.45, for a total value of $610,826.05. Following the transaction, the insider owned 30,283 shares of the company’s stock, valued at approximately $2,163,720.35. This trade represents a 22.02% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders sold a total of 864,865 shares of company stock valued at $68,967,762 in the last quarter. Insiders own 2.37% of the company’s stock.

Institutional Investors Weigh In On Kratos Defense & Security Solutions

Hedge funds have recently made changes to their positions in the company. Franklin Resources Inc. boosted its position in Kratos Defense & Security Solutions by 29.6% in the second quarter. Franklin Resources Inc. now owns 5,086,494 shares of the aerospace company’s stock valued at $236,268,000 after buying an additional 1,162,577 shares in the last quarter. ARK Investment Management LLC raised its stake in shares of Kratos Defense & Security Solutions by 22.2% in the second quarter. ARK Investment Management LLC now owns 4,507,692 shares of the aerospace company’s stock valued at $209,382,000 after acquiring an additional 818,104 shares during the last quarter. Geode Capital Management LLC boosted its holdings in shares of Kratos Defense & Security Solutions by 8.3% in the 2nd quarter. Geode Capital Management LLC now owns 3,949,763 shares of the aerospace company’s stock worth $183,490,000 after acquiring an additional 301,135 shares in the last quarter. First Trust Advisors LP grew its position in Kratos Defense & Security Solutions by 29.5% during the 3rd quarter. First Trust Advisors LP now owns 3,068,863 shares of the aerospace company’s stock worth $280,402,000 after acquiring an additional 698,778 shares during the last quarter. Finally, Invesco Ltd. increased its holdings in Kratos Defense & Security Solutions by 7.4% during the 3rd quarter. Invesco Ltd. now owns 3,046,194 shares of the aerospace company’s stock valued at $278,331,000 after purchasing an additional 209,189 shares in the last quarter. Institutional investors and hedge funds own 75.92% of the company’s stock.

Kratos Defense & Security Solutions Company Profile

Kratos Defense & Security Solutions, Inc (NASDAQ: KTOS) is a technology-driven company that specializes in national security and defense solutions for government and military customers. The firm’s core capabilities span unmanned systems, satellite communications, missile defense, cyber security, and directed-energy weapons. Through its integrated approach, Kratos delivers mission-critical products and services designed to enhance operational readiness and support force modernization initiatives.

In the unmanned systems arena, Kratos develops high-performance aerial platforms used as target drones, low-cost attritable aircraft and experimental stealth demonstrators.