What smart money is saying about Kratos Defense & Security Solutions
3 funds in our archive have pitched Kratos Defense & Security Solutions, most recently Aristotle Atlantic Large Cap Growth Strategy in September 2026.
Kratos Defense & Security Solutions, Inc. primarily functions as a contractor for the United States Department of Defense. Its business operations are organized into two distinct divisions: Kratos Government Solutions and Unmanned Systems. The Kratos Government Solutions segment delivers a comprehensive suite of products and services, including advanced microwave electronics, solutions for space and satellite communications, specialized training and cybersecurity/warfare capabilities, C5ISR (Command, Control, Communications, Computers, Combat Systems, Intelligence, Surveillance, and Reconnaissance) and modular systems, cutting-edge turbine technologies, and essential defense and rocket support services. Meanwhile, the Unmanned Systems division is dedicated to developing and supplying autonomous platforms, specifically unmanned aerial, ground, and maritime systems. Kratos caters to an extensive client base, which includes various national security organizations, the DoD, intelligence and classified agencies, international government bodies, and both domestic and global commercial enterprises. The company was established in 1994 and its corporate headquarters are located in San Diego, California.
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Fund signal · last 12 months
5 lettersToo few moves on Kratos Defense & Security Solutions yet for a clear signal
Moves described in fund letters in our archive. A sentence published word for word by several funds of one house in the same quarter counts once.
Position history
Between Q1 2025 and Q3 2026, 8 fund letters reported a position in Kratos Defense & Security Solutions, with 3 buys (opened or added) and 2 sells (trimmed or exited).
| Quarter | Letters | Bought | Sold | Theses |
|---|---|---|---|---|
| Q3 2026 | 2 | 1 | 1 | 1 |
| Q2 2026 | 3 | 1 | 0 | 0 |
| Q3 2025 | 1 | 0 | 1 | 0 |
| Q2 2025 | 1 | 0 | 0 | 2 |
| Q1 2025 | 1 | 1 | 0 | 0 |
Bought and Sold count moves: the same sentence published by several funds of one house in a quarter counts once.
Fund activity · 8 positions · 5 moves
- September 2026
“In addition to the transactions discussed above, we added positions in, FirstCash in financials, JFrog in IT, Lindblad Expeditions in consumer discretionary, Materion in materials and Spyre Therapeutics and Twist Biosciences in health care. We exited positions in Argan, Kratos Defense & Security Solutions and York Space Systems in the industrials sector.”
Kratos Defense & Security Solutions - New positionAristotle Atlantic Large Cap Growth StrategySeptember 2026
“We initiated Kratos Defense & Security Solutions, a technology-focused defense contractor that develops affordable, rapidly deployable products and platforms for government and commercial customers across satellite communications, space infrastructure, unmanned aerial systems, hypersonic technologies, rocket and propulsion systems, microwave electronics, cybersecurity, training, and command-and-control solutions. The company operates through Kratos Government Solutions and Unmanned Systems.”
Kratos Defense & Security Solutions - June 2026
“Defense contractors Kratos Defense & Security Solutions, Inc. and Karman Holdings Inc. gave back some of their large gains from the prior quarter, as the war in the Middle East appeared to near an end.”
Kratos Defense & Security Solutions - June 2026
“TOP DETRACTORS Cloudflare, Inc. detracted from relative performance as the fund’s positioning limited participation in a strong benchmark holding within cloud infrastructure and cybersecurity. While the company remains tied to attractive secular themes, its benchmark weight and strong stock performance created a relative headwind during the quarter. Kratos Defense & Security Solutions, Inc. was another detractor as defense- oriented holdings generally lagged after a strong performance run in the previous quarter.”
Kratos Defense & Security Solutions - June 2026
“Similar to Karman, shares of leading defense technology provider Kratos Defense & Security Solutions, Inc. declined during the quarter as sentiment toward high-multiple small- and mid- cap defense companies weakened amid increased uncertainty surrounding the pace of defense budget growth and a reversal in momentum-driven investor flows. We remain investors and used recent weakness to add to our position.”
Kratos Defense & Security Solutions - September 2025
“In the near term, its shares gained 95% and we trimmed on that strength.”
Kratos Defense & Security Solutions - June 2025
“Contributors • Sterling Infrastructure, Kratos Defense & Security Solutions and Construction Partners were the top individual contributors to performance. • Sterling Infrastructure is an infrastructure services business that specializes in transportation, e-infrastructure, and building solutions in the United States. The stock recovered after a sharp selloff in the first quarter on the news of DeepSeek’s AI offering. The company had a solid Q1 report, and its data center business is booming. Backlog growth inflected higher, and management spoke confidently about its visibility for the next few years. • Kratos Defense & Security Solutions is a leader in both hardware and software solutions supporting space exploration and monitoring and has a high growth target drone business with the US government as its main customer. This company also has a potentially even larger opportunity with its tactical drone offering, which we believe should continue to draw attention from the US military. • Construction Partners provides road building and paving services in the south/southeast region of the country. The company has been able to grow revenue in the mid-teens range through a combination of organic growth and M&A. This name outperformed during the quarter with a large M&A deal in Texas as well as other deals in existing markets that have accelerated revenue growth, all of which have led to higher revisions. Detractors • Grid Dynamics, Clearwater Analytics Holdings and Merit Medical Systems were the largest individual detractors from performance. • Grid Dynamics struggled during the period mainly due to the guidance that the company gave in February, which was viewed by analysts as being overly aggressive. The company did not raise guidance for the fiscal year in May, breaking a three-quarter trend of ‘beat and raise’ reports. These dynamics along with broader pressures in the IT Service industry with companies cutting guidance have added to fears of potential earnings cut, which has exacerbated selling pressures on the stock. • Clearwater Analytics Holdings provides cloud native software in investment lifecycle management for the insurance and asset management industry. Earlier this year, the company made three acquisitions and is currently in the midst of integrating these acquisitions. The uncertainty around interest rates post-election also weighed on the stock. • Merit Medical Systems is a medical device manufacturer that is focused on interventional cardiology and radiology. Tariff and trade policy concerns during the quarter negatively impacted the stock given that approximately 40% of the company’s revenues are ex-US and the fact that the company has been shifting more manufacturing to lower cost jurisdictions outside the US. Outlook • As we write this, volatility has decreased by many measures. The VIX index, which measures stock market volatility, has retreated to below average levels, as has the MOVE index, which measures bond market volatility. While the US Economic Policy Uncertainty Index has come in from the very high levels of April, it is still quite high when compared to TOP TEN EQUITY HOLDINGS (%) Sterling Infrastructure, Inc. 2.1 Kratos Defense & Security Solutions, Inc. 2.0 ESCO Technologies Inc. 2.0 MACOM Technology Solutions Holdings, Inc. 2.0 Construction Partners, Inc. 1.8”
Kratos Defense & Security Solutions - March 2025
“Kratos Defense & Security Solutions Inc. supplies technology products, systems, and software for defense, national security, and commercial markets. Their product mix includes hypersonics, missile defense, unmanned vehicles, space, and satellite communications. Profit margin was ahead of estimates and that contributed to an earnings beat in the fourth quarter. The company released a two-year guidance framework that calls for revenue growth as well as an increase in capital expenditures on areas such as hypersonics and Valkyrie drones. The other big news from management was the establishment of a joint venture with the Israeli company Rafael for a project called Prometheus Energetics to produce solid rocket motors. These developments served to lift its shares by 14% and we built up the position with rising conviction in the business.”
Kratos Defense & Security Solutions
Also mentioned · 1
These funds discuss Kratos Defense & Security Solutions as a competitor, benchmark or comparable, without disclosing a position in it.
- June 2026
“Other stocks in the recent idea hopper have included Kratos (weapon components), Alnylam (RNA-inference therapeutics) and Meesho (Indian discount online commerce).”
Kratos Defense & Security Solutions
Fund coverage · 3 theses
- Aristotle Atlantic Large Cap Growth StrategySeptember 2026
Kratos Defense & Security Solutions is a technology-focused defense contractor positioned to benefit from defense modernization, strong bookings and production scaling.
Read the full thesis - Baron Discovery FundJune 2025
Kratos is poised for accelerated growth due to its successful investments in high-demand defense technologies and increased funding from global militaries.
Read the full thesis - Merion RoadJune 2025
Kratos is a leading pure-play defense company specializing in hypersonic technologies and unmanned aircraft, known for its cost-effective and rapid product development, which positions it favorably in the growing defense market.
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