Financial Survey: Kratos Defense & Security Solutions (KTOS) versus L3 Technologies (LLL)
Kratos Defense & Security Solutions (NASDAQ: KTOS) and L3 Technologies (NYSE:LLL) are both industrials companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, dividends, earnings, valuation, institutional ownership, profitability and analyst recommendations.
Institutional and Insider Ownership
72.5% of Kratos Defense & Security Solutions shares are held by institutional investors. Comparatively, 77.8% of L3 Technologies shares are held by institutional investors. 17.9% of Kratos Defense & Security Solutions shares are held by insiders. Comparatively, 2.9% of L3 Technologies shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
L3 Technologies pays an annual dividend of $3.20 per share and has a dividend yield of 1.6%. Kratos Defense & Security Solutions does not pay a dividend. L3 Technologies pays out 37.7% of its earnings in the form of a dividend. L3 Technologies has raised its dividend for 14 consecutive years.
Risk and Volatility
Kratos Defense & Security Solutions has a beta of 1.84, suggesting that its share price is 84% more volatile than the S&P 500. Comparatively, L3 Technologies has a beta of 1.23, suggesting that its share price is 23% more volatile than the S&P 500.
This is a breakdown of recent recommendations and price targets for Kratos Defense & Security Solutions and L3 Technologies, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Kratos Defense & Security Solutions||0||4||5||0||2.56|
Kratos Defense & Security Solutions presently has a consensus price target of $13.00, indicating a potential upside of 15.66%. L3 Technologies has a consensus price target of $213.00, indicating a potential upside of 3.78%. Given Kratos Defense & Security Solutions’ higher probable upside, equities analysts plainly believe Kratos Defense & Security Solutions is more favorable than L3 Technologies.
This table compares Kratos Defense & Security Solutions and L3 Technologies’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Kratos Defense & Security Solutions||-5.68%||0.77%||0.31%|
Earnings and Valuation
This table compares Kratos Defense & Security Solutions and L3 Technologies’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Kratos Defense & Security Solutions||$751.90 million||1.55||-$60.50 million||($0.85)||-13.22|
|L3 Technologies||$9.57 billion||1.68||$677.00 million||$8.48||24.20|
L3 Technologies has higher revenue and earnings than Kratos Defense & Security Solutions. Kratos Defense & Security Solutions is trading at a lower price-to-earnings ratio than L3 Technologies, indicating that it is currently the more affordable of the two stocks.
L3 Technologies beats Kratos Defense & Security Solutions on 14 of the 18 factors compared between the two stocks.
About Kratos Defense & Security Solutions
Kratos Defense & Security Solutions, Inc. is a technology, intellectual property and proprietary product and solution company focused on the United States and its allies’ national security. The Kratos Government Solutions segment includes the operations of Defense Rocket Support Services, Microwave Electronics Division, Technical and Training Solutions, and Modular Systems, which provide technology-based defense solutions, involving products and services, with the focus relating to the nation’s Command, Control, Communications, Computing, Combat Systems, Intelligence, Surveillance and Reconnaissance requirements. The Unmanned Systems segment includes its unmanned aerial, ground, seaborne and command, control and communications system business. The Public Safety & Security segment provides integrated solutions for homeland security, public safety, critical infrastructure, and security and surveillance systems for government and commercial applications.
About L3 Technologies
L3 Technologies, Inc., formerly L-3 Communications Holdings, Inc., is a prime contractor in Intelligence, Surveillance and Reconnaissance (ISR) systems, aircraft sustainment, simulation and training, night vision and image intensification equipment and security and detection systems. The Company provides a broad range of communication and electronic systems and products used on military and commercial platforms. It operates through four segments: Electronic Systems, Aerospace Systems, Communication Systems and Sensor Systems. Electronic Systems provides a broad range of products and services for military and commercial customers in several niche markets across several business areas. Aerospace Systems delivers integrated solutions and provides engineering, modernization, upgrade, sustainment, and maintenance and logistics support. Communication Systems delivers products and services for the global communications market. Sensor Systems provides diverse sensor technologies.
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