Oppenheimer Maintains a 'Perform' on Kratos Defense & Security (KTOS); A Lot Needs to Go Right in 2H

August 3, 2012 1:26 PM EDT Send to a Friend
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Price: $7.63 -2.05%

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Oppenheimer maintains a 'Perform' on Kratos Defense & Security (NASDAQ: KTOS).

Analyst, Yair Reiner, said, "Our 2Q12 targets for KTOS were low, but not low enough. While the past 12 months of acquisitions (Integral, SecureInfo, Critical Infrastructure) lifted sales 29% YoY, KTOS' 13% organic revenue decline was sharper than we or the Street had modeled. Profit was also soft, with 2Q12 EBITDA of $24.3M missing the Street's $27.5M. Also, with the integration of the Critical Infrastructure business pushed to 2H, PSS margins will see pressure for the rest of 2012. Overall, we think a lot needs to go right in 2H12 for KTOS to hit its reiterated full-year target, which seems a wee too hopeful given the dual headwinds of a likely CR and a possible sequestration."

FY12 EPS estimate lowered from (0.05) to (0.34) and FY13 lowered from $0.23 to $0.17.

For an analyst ratings summary and ratings history on Kratos Defense & Security click here. For more ratings news on Kratos Defense & Security click here.

Shares of Kratos Defense & Security closed at $5.47 yesterday.




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