The $10-50 price range often includes mid-sized businesses with proven track records and plenty of growth runway ahead.
They also usually carry less risk than penny stocks, though they’re not immune to volatility as many lack the scale advantages of their larger peers.
Aerospace and defense company Kratos (NASDAQ:KTOS) announced better-than-expected revenue in Q1 CY2025, with sales up 9.2% year on year to $302.6 million. On the other hand, next quarter’s revenue guidance of $305 million was less impressive, coming in 3.3% below analysts’ estimates. Its non-GAAP profit of $0.12 per share was 32.8% above analysts’ consensus estimates.
Expensive stocks typically earn their valuations through superior growth rates that other companies simply can’t match.
The flip side though is that these lofty expectations make them particularly susceptible to drawdowns when market sentiment shifts.
While profitability is essential, it doesn’t guarantee long-term success.
Some companies that rest on their margins will lose ground as competition intensifies - as Jeff Bezos said, "Your margin is my opportunity".
It’s a pinnacle of innovation when a company opens up new revenue spigots or marketing vistas by adding new features to an existing (and already successful) product. That is exactly what Kratos Defense & Security Solutions Inc. recently did.
Volatility cuts both ways - while it creates opportunities, it also increases risk, making sharp declines just as likely as big gains.
This unpredictability can shake out even the most experienced investors.
Rocket Lab USA Inc. (NASDAQ: RKLB) has secured a major defense contract from Kratos Defense & Security Solutions Inc. (NASDAQ: KTOS) to perform a hypersonic flight test for the U.S. Department of Defense. Scheduled for early 2026, the mission supports MACH-TB 2.0, a $1.45 billion program aimed at fast-tracking hypersonic weapons development and testing.
Rocket Lab USA Inc (NASDAQ:RKLB) shares are trading higher Thursday after the company announced it was selected by Kratos Defense & Security Solutions Inc (NASDAQ:KTOS) to provide a hypersonic test flight for the U.S. Department of Defense (DOD).
As the Q4 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the defense contractors industry, including Kratos (NASDAQ:KTOS) and its peers.
Even during a down period for the markets, Kratos has gone against the grain, climbing to $28.94. Its shares have yielded a 15.4% return over the last six months, beating the S&P 500 by 26%. This run-up might have investors contemplating their next move.
The Russell 2000 is home to many small-cap stocks, offering investors the chance to uncover hidden gems before the broader market catches on.
However, these companies often come with higher volatility and risk, as their smaller size makes them more vulnerable to economic downturns.
The military landscape has always been a dynamic arena, shaped by technological advancements, geopolitical shifts, and evolving threats. As we stand in 2025, the world is on the cusp of transformative changes that will redefine how nations defend their interests, project power, and maintain peace—or wage war. From artificial
The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how RTX (NYSE:RTX) and the rest of the defense contractors stocks fared in Q4.
