Kratos Defense Stock Is Sliding Thursday: Here's Why

Kratos Defense & Security Solutions Inc KTOS shares are trading lower Thursday after the company announced a public offering of common stock.

What Happened: Kratos announced an underwritten offering of approximately 12.99 million shares of its common stock at a price of $38.50 per share. The company also granted the underwriters a 30-day option to purchase up to an additional 1.95 million shares.

All shares are being sold by Kratos. The company anticipates net proceeds of approximately $483.75 million. The offering is expected to close on June 27.

Kratos said it plans to use the proceeds to scale and execute on large National Security priorities related to existing programs, recent program awards and “significant high-probability pipeline opportunities.” The company also plans to use some of the proceeds to finance customer and program targeted acquisitions and to pay down debt.

Kratos said it had a bid and proposal pipeline of $12.6 billion as of March 30, including a funded backlog of $1.17 billion and an unfunded backlog of $334.5 million. The company had $263.7 million in cash and cash equivalents as of March 30.

How To Buy KTOS Stock

Besides going to a brokerage platform to purchase a share – or fractional share – of stock, you can also gain access to shares either by buying an exchange traded fund (ETF) that holds the stock itself, or by allocating yourself to a strategy in your 401(k) that would seek to acquire shares in a mutual fund or other instrument.

For example, in Kratos Defense & Security's case, it is in the Industrials sector. An ETF will likely hold shares in many liquid and large companies that help track that sector, allowing an investor to gain exposure to the trends within that segment.

KTOS Price Action: Kratos Defense shares were down 7.08% at $39.34 at the time of publication Thursday, according to Benzinga Pro.

Read Next: