Kratos Defense & Security Solutions, Inc. KTOS reported fourth-quarter 2024 adjusted earnings of 13 cents per share, up 8.3% from 12 cents in the prior-year quarter. The bottom line also surpassed the Zacks Consensus Estimate of nine cents per share by 44.4%.

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Kratos Defense reported GAAP earnings of three cents per share compared with two cents in the fourth quarter of 2023.

The company reported 2024 adjusted earnings of 49 cents per share, which were higher than the year-ago figure of 42 cents. The full-year bottom line also surpassed the Zacks Consensus Estimate of 46 cents per share.

KTOS’ Total Revenues

Total revenues were $283.1 million, which missed the Zacks Consensus Estimate of $288 million by 1.8%. The figure, however, rose 3.4% from $273.8 million recorded in the year-ago quarter.

The year-over-year improvement can be attributed to the Unmanned Systems and Kratos Government Solutions segments’ revenue growth.

The company reported total revenues of $1.14 billion in 2024, which were higher than $1.04 billion in 2023. The full-year top line was in line with the Zacks Consensus Estimate.

Kratos Defense & Security Solutions, Inc. Price, Consensus and EPS Surprise

Kratos Defense & Security Solutions, Inc. price-consensus-eps-surprise-chart | Kratos Defense & Security Solutions, Inc. Quote

Operational Update of Kratos Defense

Kratos Defense’s selling, general and administrative expenses increased 1.1% year over year. Research and development expenses rose 32.5%. Depreciation expenses surged 19% year over year.

Expenses related to the amortization of intangible assets decreased 8.7% year over year.

The company reported operating income of $3 million, which declined from the year-ago quarter’s $11.7 million.

It posted a consolidated book-to-bill ratio of 1.5-1.0, with bookings worth $434.2 million.

The total backlog at the end of the fourth quarter was $1.45 billion compared with $1.29 billion at the end of the third quarter of 2024.

KTOS’ Segmental Performance

Unmanned Systems: Net revenues improved 10.3% year over year to $61.1 million.

Kratos Government Solutions: Net revenues improved 1.6% to $222 million on a year-over-year basis.

Financial Details of KTOS

As of Dec. 29, 2024, cash and cash equivalents totaled $329.3 million, up from $72.8 million as of Dec. 31, 2023.

The long-term debt amounted to $174.6 million as of Dec. 29, 2024, down from $219.3 million recorded as of Dec. 31, 2023.

The net cash flow from operating activities amounted to $49.7 million during 2024 compared with $65.2 million at the end of 2023.

Kratos Defense’s 2025 Guidance

Kratos Defense has introduced its first-quarter and full-year 2025 guidance.

KTOS projects first-quarter 2025 revenues to be in the range of $285-$295 million. The Zacks Consensus Estimate for revenues is pegged at $303.5 million, higher than the company’s guided range.

KTOS expects 2025 revenues to be in the $1.26-$1.29 billion range. The Zacks Consensus Estimate for revenues is pegged at $1.28 million, almost in line with the mid-point of the company’s guided range.

Kratos Defense expects operating cash flows to be in the range of $50-$60 million and free cash outflow to be in the range of $75-$85 million for 2025.

KTOS’ Zacks Rank

Kratos Defense currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Recent Defense Releases

Teledyne Technologies Inc. TDY reported fourth-quarter 2024 adjusted earnings of $5.52 per share, which surpassed the Zacks Consensus Estimate of $5.23 by 5.5%. Total sales were $1.50 billion, which beat the consensus estimate of $1.45 billion by 3.7%.

Textron Inc. TXT reported fourth-quarter 2024 adjusted earnings of $1.34 per share, which beat the Zacks Consensus Estimate of $1.25 by 7.2%. The company reported total revenues of $3.61 billion, which missed the consensus estimate of $3.74 billion by 3.5%.

Hexcel Corporation HXL reported fourth-quarter 2024 adjusted earnings of 52 cents per share, which surpassed the Zacks Consensus Estimate of 51 cents by 2%. The company’s net sales totaled $473.8 million, which beat the consensus estimate of $471 million by 0.6%.

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