KTOS vs. CW: Where Should Investors Place Their Bets Right Now?

As rising global security threats are driving higher defense spending, major defense companies like Kratos Defense & Security Solutions, Inc. KTOS and Curtiss-Wright CW are drawing investor focus. Both companies are deeply tied to the U.S. defense sector and derive a meaningful portion of their revenues from military and government contracts.

KTOS and CW are well-positioned to benefit from sustained increases in U.S. and allied defense budgets, particularly as spending shifts toward modernization and advanced military systems. KTOS gains from its focus on unmanned systems, space technologies, and missile defense, while CW benefits from providing high-value engineered components, electronics, and control systems that are critical to defense and aerospace platforms. Together, their technology-driven, mission-critical offerings align closely with long-term defense modernization priorities, supporting steady demand for their solutions.

Let's compare the stocks' fundamentals to determine which one is a better investment option at present.

The Case for KTOS Stock

Kratos Defense stands to benefit from opening its new 55,000-square-foot hypersonic system manufacturing and payload integration facility in Princess Anne, MD, by significantly boosting its capacity to support key hypersonic programs. The advanced facility will allow the company to increase production, streamline integration processes, and accelerate hypersonic testing and launch operations. 

Kratos Defense is expanding its Birmingham, AL, operations with a new 40,000-square-foot facility, increasing its Oxmoor Valley campus to approximately 150,000 square feet. The expansion is intended to support growing demand across defense and national security programs while reinforcing U.S. defense readiness and the company’s long-term commitment to the local skilled workforce and manufacturing base.

The Case for CW Stock

Curtiss-Wright stands to benefit from its collaboration with Green Hills Software on a new high-performance safety-certifiable COTS computing solution by strengthening its position in the critical avionics and aerospace market, where systems must meet stringent safety and airworthiness certification standards. This enhances Curtiss-Wright’s product portfolio with certifiable solutions, making it more competitive and attractive to customers seeking reliable, high-assurance technology.

In November 2025, Curtiss-Wright announced that its PacStar® 451, 452, 453, and 454 tactical edge servers, which are part of PacStar Modular Data Center, are validated for Azure Local.  This is expected to expand Curtiss-Wright’s market by meeting defense customers’ demand for hybrid cloud and edge computing at the tactical edge, supporting faster decision-making and greater autonomy in the field.

How Do Zacks Estimates Compare for KTOS & CW?

The Zacks Consensus Estimate for Kratos Defense’s 2026 earnings per share (EPS) indicates an increase of 41.92% year over year.
 

The Zacks Consensus Estimate for Curtiss-Wright’s 2026 EPS indicates an increase of 11.21% year over year.

Valuation for KTOS & CW

KTOS shares trade at a forward 12-month Price/Sales (P/S F12M) of 12.28X compared with CW’s 6.57X.

Debt Position of KTOS & CW

Currently, total debt to capital for Kratos Defense is nil, while that of Curtiss-Wright is 27.69%.

KTOS & CW’s Price Performance

In the past three months, shares of Kratos Defense and Curtiss-Wright have risen 32.9% and 12.2%, respectively.

KTOS or CW: Which Is a Better Choice Now?

Kratos Defense is poised to benefit from its new Maryland hypersonic facility and expanded Alabama operations by boosting manufacturing capacity, improving integration and testing efficiency, and supporting rising demand across defense and national security programs, while strengthening U.S. defense readiness and its long-term manufacturing footprint. Curtiss-Wright benefits from strengthening its avionics and aerospace portfolio through a safety-certifiable COTS computing collaboration with Green Hills Software, enhancing its appeal in high-assurance defense markets, while Azure Local validation of its PacStar tactical edge servers expands its reach in hybrid cloud and edge computing, supporting faster, more autonomous military operations.

However, our current preference is Kratos Defense, given its stronger earnings growth, superior debt management and better price performance than Curtiss-Wright. KTOS carries a Zacks Rank #2 (Buy) and CW has a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

 

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This article originally published on Zacks Investment Research (zacks.com).

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