Kratos Defense & Security Solutions stock fell 5.9% despite beating fourth-quarter earnings expectations. The company reported Q4 revenue of $345.1 million, exceeding its guidance range of $320-$330 million, with 20% year-over-year organic growth. Q4 adjusted EBITDA was $34.1 million. However, the stock declined due to the company's 2026 financial guidance, which implied sales growth of nearly 20% but essentially matched Wall Street's expectations. The stock had experienced a 280% increase over the prior 12 months. Additionally, significant insider selling occurred, with the CEO selling 200,000 shares for approximately $14.8 million, and insiders selling a total of 911,907 shares valued at roughly $74.9 million over the past three months. UBS Group also initiated coverage with a neutral rating and $79 price target, implying 25% downside.
Read full analysisKratos Defense & Security Solutions stock fell 5.9% despite beating fourth-quarter earnings expectations. The company reported Q4 revenue of $345.1 million, exceeding its guidance range of $320-$330 million, with 20% year-over-year organic growth. Q4 adjusted EBITDA was $34.1 million. However, the stock declined due to the company's 2026 financial guidance, which implied sales growth of nearly 20% but essentially matched Wall Street's expectations. The stock had experienced a 280% increase over the prior 12 months. Additionally, significant insider selling occurred, with the CEO selling 200,000 shares for approximately $14.8 million, and insiders selling a total of 911,907 shares valued at roughly $74.9 million over the past three months. UBS Group also initiated coverage with a neutral rating and $79 price target, implying 25% downside.
Kratos Defense & Security Solutions is a San Diego-based defense technology company specializing in unmanned drone systems, satellite communications, hypersonic technologies, and solid rocket motors for military and national security customers. The company holds a record $1.573 billion backlog and forecasts hypersonics revenue of roughly $400 million in fiscal 2026, rising to $700 million in 2027, positioning it as a key beneficiary of U.S. defense spending on autonomous and hypersonic platforms. Today's selloff reflects the market recalibrating expectations after Q4 earnings beat estimates but fiscal 2026 guidance merely matched consensus following a 280% stock rally.