Kratos Defense & Security Solutions Inc. (NASDAQ: KTOS ) stock traded about 2% lower Monday as investors took profits following a recent rebound.
The decline came even as the Industrials sector gained 0.12%. The Nasdaq rose 0.36%, while the S&P 500 slipped 0.13%.
Kratos had no clear company-specific catalyst driving Monday’s decline. Instead, the move appeared to reflect profit-taking after the stock’s recent rally.
Kratos, GE Aerospace Expand Defense Push
Separately, Kratos Defense and GE Aerospace (NYSE: GE ) said their GEK800 engine received the U.S. military designation F143-ZZ-100 .
The companies also secured a U.S. Air Force engineering, manufacturing and development contract. The GEK800 will serve as a second-source propulsion system for the Joint Air-to-Surface Standoff Missile, or JASSM.
Latest Private Market Opportunities Join 400,000+ InvestorsThe companies are developing small, lower-cost turbofan engines for cruise missiles, collaborative combat aircraft and other uncrewed aerial vehicles. The GEK800 is an 800-pound-thrust turbofan.
Technical Analysis
Kratos remains well above its short-term moving averages. The stock is 18.2% above its 20-day simple moving average of $54.17 and 21.4% above its 50-day SMA of $52.74.
However, shares remain 12.9% below the 200-day SMA of $73.52. That suggests the longer-term recovery remains incomplete.
Momentum has improved. The MACD is above its signal line, while the histogram is positive. Still, the 50-day SMA remains below the 200-day SMA following an April death cross.
Traders may watch $67 as near-term resistance. Support sits around $53.50.
Analyst Outlook
The stock trades at a price-to-earnings ratio of about 379.9, reflecting a premium valuation. It carries a Buy consensus rating with an average price forecast of $94.14.
Truist Securities maintained a Buy rating but lowered its price forecast to $104 on Aug. 13. Canaccord Genuity maintained a Buy rating and raised its forecast to $135 on Aug. 6. Stifel also maintained a Buy rating while lowering its forecast to $115 on Aug. 6.
Benzinga Edge Rankings
Kratos has a Momentum score of 21.33 and a Value score of 4.83. However, its Growth score stands at 95.07, according to the Benzinga Edge Stock Rankings .
The scores point to strong growth characteristics but weaker momentum and value metrics.
ETF Exposure
Kratos is held by several exchange-traded funds. The First Trust RBA American Industrial Renaissance ETF (NASDAQ: AIRR ) has a 3.43% weighting in the stock.
The ARK Autonomous Technology & Robotics ETF (BATS: ARKQ ) has a 5.91% weighting, while the ARK Space & Defense Innovation ETF (NASDAQ: ARKX ) has a 6.36% weighting.
As a result, meaningful inflows or outflows from these funds can add buying or selling pressure to Kratos shares.
KTOS Price Action
Kratos Defense shares were down 2.06% at $63.25 at the time of publication Monday, according to Benzinga Pro data .
Photo via Shutterstock
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