Kratos Defense (KTOS) To Post Q3 Earnings: What's In Store?
Zacks Investment Research | Oct 30, 2019 09:27PM ET
Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) is set to release third-quarter 2019 results on Nov 5, after market close.
In the last reported quarter, the company delivered a positive earnings surprise of 14.29%. Moreover, Kratos’ earnings surpassed the Zacks Consensus Estimate in the trailing four quarters, the average positive surprise being 132.74%.
Let’s see how things are shaping up prior to this announcement.
Factors at Play
During the third quarter, Kratos won a handful of major contracts, which might have boosted its third-quarter backlog.
During the second-quarter earnings call, the company announced the delivery of the Gremlin tactical drone UAVs to Dynetics. The company also received an initial contract funding from Dynetics for its Spartan program. We expect these synergies to have boosted Kratos’ third-quarter performance.
Also, in the second-quarter earnings call, the company revealed its revenue guidance of $175-$185 million for the third quarter. The Zacks Consensus Estimate for third-quarter revenues stands at $184 million, which lies above the mid-point of the company’s guidance and indicates a rise of 15.7% from the year-ago quarter’s reported figure.
Moreover, Kratos has been investing heavily in manufacturing and test equipment at its new Oklahoma facility, which in turn is likely to have pushed its production cost. This, in turn, is expected to have dampened the company’s bottom-line performance in the to-be-reported quarter.
The Zacks Consensus Estimate for Kratos’ third-quarter earnings is pegged at 4 cents, implying a 42.9% decline from the prior-year quarter’s reported figure.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Kratos in the third quarter. The combination of a positive Zacks Investment Research
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