Kratos Defense & Security Solutions, Inc. (KTOS) vs Textron Inc. (TXT)

Kratos Defense & Security Solutions, Inc. and Textron Inc. are both Aerospace & Defense companies. Textron Inc. is the larger, with a market value of $13.0B against $8.8B — 1.5× the size. Textron Inc. trades at the lower P/E: 14.5× against 268×. Kratos Defense & Security Solutions, Inc. grew revenue faster over the last twelve months: 25.5% against 8.80%. Textron Inc. has the higher net margin (6.12% vs 2.03%) and the higher return on invested capital (6.25% vs 0.54%). Across the 21 metrics below, Textron Inc. leads on 14 and Kratos Defense & Security Solutions, Inc. on 7.

Valuation

Metric KTOS TXT Aerospace & Defense median
P/E 268.35 14.45 33.00
P/S 5.65 0.87 3.63
P/B 2.51 1.65 3.24
Price to free cash flow n/m 17.37 34.01
EV/EBITDA 76.44 10.87 18.69
EV/Sales 4.80 1.01 3.94
Earnings yield 0.37% 6.92% 1.31%
Free cash flow yield (1.50%) 5.76% 0.00%

Profitability

Metric KTOS TXT Aerospace & Defense median
Gross margin 23.00% 17.77% 25.48%
Operating margin 1.21% 6.71% 4.54%
Net margin 2.03% 6.12% 2.22%
Free cash flow margin (8.47%) 5.00% 0.00%
Return on equity 1.15% 12.10% 6.43%
Return on assets 0.93% 5.32% 2.70%
Return on invested capital 0.54% 6.25% 1.56%

Growth

Metric KTOS TXT Aerospace & Defense median
Revenue growth (TTM) 25.50% 8.80% 18.43%
EPS growth (last fiscal year) 18.18% 18.01% —
Revenue growth, 5-year CAGR 12.49% 4.90% 9.62%
Net income growth, 5-year CAGR (22.68%) 24.41% 0.00%

Health

Metric KTOS TXT Aerospace & Defense median
Debt to equity 0.04 0.47 0.24
Current ratio 5.54 1.86 2.72
Net debt to EBITDA (5.44) 1.32 1.12

Dividend

Metric KTOS TXT Aerospace & Defense median
Dividend yield — 0.09% 1.04%
Payout ratio 0.00 0.02 0.00

Size

Metric KTOS TXT Aerospace & Defense median
Market cap 8.84b 13.00b 2.52b

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