Head to Head Comparison: Carpenter Technology (NYSE:CRS) and Kratos Defense & Security Solutions (NASDAQ:KTOS)
by Renee Jackson · The Cerbat GemKratos Defense & Security Solutions (NASDAQ:KTOS – Get Free Report) and Carpenter Technology (NYSE:CRS – Get Free Report) are both industrials companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, earnings, valuation, dividends, profitability, risk and analyst recommendations.
Institutional & Insider Ownership
75.9% of Kratos Defense & Security Solutions shares are owned by institutional investors. Comparatively, 92.0% of Carpenter Technology shares are owned by institutional investors. 1.5% of Kratos Defense & Security Solutions shares are owned by company insiders. Comparatively, 2.9% of Carpenter Technology shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Profitability
This table compares Kratos Defense & Security Solutions and Carpenter Technology’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Kratos Defense & Security Solutions | 2.03% | 3.07% | 2.55% |
| Carpenter Technology | 16.96% | 26.46% | 15.02% |
Analyst Ratings
This is a breakdown of current ratings and price targets for Kratos Defense & Security Solutions and Carpenter Technology, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Kratos Defense & Security Solutions | 1 | 2 | 18 | 1 | 2.86 |
| Carpenter Technology | 0 | 1 | 8 | 1 | 3.00 |
Kratos Defense & Security Solutions currently has a consensus target price of $99.47, suggesting a potential upside of 113.04%. Carpenter Technology has a consensus target price of $577.25, suggesting a potential upside of 30.31%. Given Kratos Defense & Security Solutions’ higher possible upside, equities analysts clearly believe Kratos Defense & Security Solutions is more favorable than Carpenter Technology.
Earnings & Valuation
This table compares Kratos Defense & Security Solutions and Carpenter Technology”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Kratos Defense & Security Solutions | $1.35 billion | 6.51 | $22.00 million | $0.17 | 274.65 |
| Carpenter Technology | $3.12 billion | 7.03 | $529.80 million | $10.52 | 42.11 |
Carpenter Technology has higher revenue and earnings than Kratos Defense & Security Solutions. Carpenter Technology is trading at a lower price-to-earnings ratio than Kratos Defense & Security Solutions, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Kratos Defense & Security Solutions has a beta of 1.11, indicating that its share price is 11% more volatile than the S&P 500. Comparatively, Carpenter Technology has a beta of 1.26, indicating that its share price is 26% more volatile than the S&P 500.
Summary
Carpenter Technology beats Kratos Defense & Security Solutions on 11 of the 14 factors compared between the two stocks.
About Kratos Defense & Security Solutions
Kratos Defense & Security Solutions, Inc. engages in the provision of mission critical products, services and solutions for United States national security priorities. It operates through the Kratos Government Solutions (KGS) and Unmanned Systems (US) segments. The KGS segment consists of an aggregation of KGS operating segments, including microwave electronic products, space, satellite and cyber, training solutions. The US segment refers to the unmanned aerial, unmanned ground, unmanned seaborne and related command, control and communications system businesses. The company was founded on December 19, 1994, and is headquartered in Round Rock, TX.
About Carpenter Technology
Carpenter Technology Corporation engages in the manufacture, fabrication, and distribution of specialty metals in the United States, Europe, the Asia Pacific, Mexico, Canada, and internationally. It operates in two segments, Specialty Alloys Operations and Performance Engineered Products. The company offers specialty alloys, including titanium alloys, powder metals, stainless steels, alloy steels, and tool steels, as well as additives, and metal powders and parts. It serves to aerospace, defense, medical, transportation, energy, industrial, and consumer markets. The company was founded in 1889 and is headquartered in Philadelphia, Pennsylvania.