Why Kratos Defense Stock Keeps Going Up Today

• Kratos Defense is gathering a caller mill to grow weapons production.

• President Trump has promised much wealth for defence contractors who put successful production.

• 10 stocks we similar amended than Kratos Defense & Security Solutions ›

On a reddish time for the banal market, Kratos Defense & Security (NASDAQ: KTOS) banal conscionable keeps going up.

Shares of the subject drones banal marked a 3rd consecutive time of gains Monday, up 2.5% done 10:15 a.m. ET, aft announcing plans to grow accumulation with a caller 40,000 quadrate ft mill successful Birmingham, Ala.

Last week, President Trump called for a immense enlargement of the U.S. defence fund to $1.5 trillion -- with strings attached. In speech for sharing successful the flood of caller money, defence contractors would request to perpetrate to not paying dividends oregon buying backmost stock, and utilizing the other gross they cod from contracts to marque superior investments to grow weapons production.

Kratos already doesn't wage a dividend, however. It's besides expanded its stock number by 37% implicit the past 5 years. (But note: That's not needfully a bully thing).

Responding astir straight to the President's privation database of demands, Kratos present says it's gathering a caller mill -- impervious affirmative of its "long-term committedness to Alabama's skilled workforce, precocious manufacturing base, and relation successful supporting U.S. defence readiness."

The caller mill volition assistance Kratos "rapidly design, make and tract applicable subject people hardware, bundle and systems," including HORUS high-altitude imaging systems, CRADLE radar communications platforms, and "UltraSpec" inspection exertion for precocious composite materials.

Kratos is making a astute determination present to align itself with Trump's defence policy. I bash evidently inactive person concerns astir the stock's valuation -- 800 times trailing net is simply a lot to wage for a defence banal -- and its deficiency of escaped currency flow.

The company's PR section is firing connected each cylinders, however, and the President should beryllium pleased.

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