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    Did Kratos’ New Canadian PT6 Overhaul Hub Just Recast Kratos Defense & Security Solutions' (KTOS) Investment Narrative?

    Simply Wall St·12/14/2025 12:15:05
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    • Earlier this month, Kratos Defense & Security Solutions opened a new 10,000-square-foot PT6A and PT6T engine overhaul facility in Vancouver, British Columbia, aimed at boosting efficiency, capacity, and support for North American operators while reinforcing its Bristow, Oklahoma operations.
    • This expansion, alongside Kratos’ work on hypersonic systems and advanced turbine programs, signals a broader push to deepen its role in next-generation propulsion and aerospace support across defense and commercial markets.
    • We’ll now examine how Kratos’ expanded PT6 engine overhaul footprint in Canada may influence its long-term defense-focused investment narrative.

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    Kratos Defense & Security Solutions Investment Narrative Recap

    To own Kratos, you generally have to believe in its ability to convert defense and aerospace R&D in areas like hypersonics, drones, and propulsion into lasting, profitable programs despite heavy upfront spending and lumpier government demand. The new Vancouver PT6 facility modestly supports that thesis by broadening the aftermarket and services base, but it does not materially change the key near term swing factor, which remains whether major unmanned and hypersonic contracts scale fast enough to offset working capital and CapEx pressure.

    In that context, Kratos’ broader hypersonic push, including the Erinyes glide body and Zeus solid rocket motor under the Pentagon’s Multi Service Advanced Capability Hypersonic Test Bed, looks more directly tied to the main catalyst: converting advanced development into repeatable, funded programs. The PT6 overhaul expansion fits around this by potentially adding a steadier services component, but investors watching the stock are likely to focus more on how quickly hypersonic and unmanned programs transition from testbed to operational deployment and what that means for future cash generation.

    Yet behind this growth story, investors should be aware of the rising working capital and CapEx burden if large defense awards are slower than expected...

    Read the full narrative on Kratos Defense & Security Solutions (it's free!)

    Kratos Defense & Security Solutions' narrative projects $1.9 billion revenue and $101.6 million earnings by 2028. This requires 17.0% yearly revenue growth and about a $87.1 million earnings increase from $14.5 million today.

    Uncover how Kratos Defense & Security Solutions' forecasts yield a $100.56 fair value, a 32% upside to its current price.

    Exploring Other Perspectives

    KTOS 1-Year Stock Price Chart
    KTOS 1-Year Stock Price Chart

    Fourteen members of the Simply Wall St Community currently see Kratos’ fair value anywhere between US$4 and about US$101, underlining how far apart individual views can be. When you weigh that spread against Kratos’ heavy upfront investment and reliance on future program ramps, it becomes even more important to compare several perspectives before deciding how the stock might fit in your portfolio.

    Explore 14 other fair value estimates on Kratos Defense & Security Solutions - why the stock might be worth less than half the current price!

    Build Your Own Kratos Defense & Security Solutions Narrative

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    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.