Canaccord analyst Ken Herbert lowered his price target on Kratos Defense as budget timing remains a headwind. The analyst said the company posted strong Q3 results which offset the near-term risk. Management stated that it expects organic growth and margin expansion for the company in 2020. Herbert reiterated his Buy rating and lowered his price target to $25 from $28 on Kratos Defense shares.

Raymond James analyst Brian Gesuale upgraded Kratos Defense to Strong Buy from Outperform with a price target of $27, up from $20. Drones and air defense demand has accelerated with the ongoing and escalating conflicts globally, the analyst tells investors in a research note. The firm says drone and loitering munitions adoption has accelerated "well beyond the theater of operations" given the success of Switchblade and other technologies in the field. It believes we are in the very early stages of a generational upgrade to air defense systems globally.