Steven S. Fendley, who leads the U.S. Division at Kratos Defense & Security Solutions (NASDAQ: KTOS), sold a total of 7,000 common shares on February 23, 2026, generating about $647,976 in proceeds. The disposition was carried out in two separate trades as part of a 10b5-1 trading plan the executive adopted on May 12, 2025.
The larger of the two transactions consisted of 5,700 shares sold at a weighted average price of $92.4148, with individual execution prices spanning $92.00 to $92.97. The remaining 1,300 shares were sold at a weighted average price of $93.24, with prices ranging from $93.05 to $93.34.
After these sales, Fendley retains 334,648 shares of Kratos common stock, which includes approximately 2,302 shares held through the company 401(k) plan.
Market context and valuation signals
At the time the insider sale was reported, Kratos shares were trading at $88.22, below a prior close of $90.68. Despite the recent pullback, the stock has delivered a one-year return of 251%, according to InvestingPro data. The company's market capitalization is reported at $15.13 billion.
That performance sits alongside valuation commentary from InvestingPro, which categorizes Kratos as overvalued relative to its Fair Value and lists it among firms on its Most Overvalued list. The company is trading at a price-to-earnings ratio of 664, a multiple that reflects elevated valuation expectations. InvestingPro also provides 18 additional tips for KTOS subscribers.
Contract wins and quarterly performance
In other corporate developments, Kratos received a $61.1 million contract modification from the U.S. Navy to produce aerial target systems. The modification covers 70 BQM-177A Subsonic Aerial Targets along with related components.
Financially, Kratos reported a 22% increase in fourth-quarter fiscal 2025 revenues to about $345 million, and adjusted EBITDA rose 35% to $34 million. These results topped expectations: revenue exceeded Canaccord Genuity and consensus estimates by 3.1% and 5.5%, respectively, while adjusted EBITDA beat those same benchmarks by 6.6% and 5.9%.
Analyst reception
Several equity research firms have weighed in following the results. Stifel kept a Buy rating on Kratos, highlighting 20% organic revenue growth in the fourth quarter that outpaced estimates by 5%. Cantor Fitzgerald reiterated an Overweight stance, noting positive growth and order commentary despite forecasting greater-than-expected free cash flow burn. Truist Securities also maintained a Buy rating, underscoring Kratos' hypersonics growth prospects and revenue outlook for 2026 and 2027. Canaccord Genuity raised its price target to $125, citing the company’s strong fourth-quarter performance.
Fendley’s sale, executed under a previously established trading plan, is presented alongside continued operational momentum and divergent market views on valuation. The data points in the public filings and analyst notes outline both current strength in sales and orders and the market’s robust valuation expectations for Kratos.