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Karman Holdings Inc. (KRMN)
NYSE:KRMN
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Karman Holdings Inc.
(NYSE:KRMN)
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Rating:64Neutral
Price Target:
$85.00
▼(-0.92% Downside)
Karman Holdings Inc. has a solid overall performance driven by strong technical indicators and promising financial growth. However, high leverage and lack of valuation metrics pose risks. The stock's bullish momentum is a key strength, but financial stability concerns limit the overall score.
Positive Factors
Revenue Growth
Strong revenue growth indicates successful market expansion and product adoption, supporting long-term business sustainability.
Cash Flow Improvements
Improved cash flow enhances liquidity and operational efficiency, providing a solid foundation for future investments and growth.
Profit Margin Improvement
Improving profit margins reflect effective cost management and operational efficiency, contributing to long-term profitability.
Negative Factors
High Leverage
High leverage can increase financial risk and limit flexibility, potentially impacting the company's ability to invest in growth opportunities.
Negative Equity
Negative equity suggests financial instability, which could hinder the company's ability to secure financing and sustain operations long-term.
Reliance on Financing Activities
Dependence on external financing may pose risks if market conditions change, affecting the company's ability to maintain liquidity and fund operations.
Karman Holdings Inc. (KRMN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$11.35B
Dividend YieldN/A
Average Volume (3M)1.40M
Price to Earnings (P/E)―
Beta (1Y)1.40
Revenue GrowthN/A
EPS GrowthN/A
CountryUS
Employees1,113
SectorIndustrials
Sector Strength72
IndustryAerospace & Defense
Share Statistics
EPS (TTM)0.10
Shares Outstanding132,322,430
10 Day Avg. Volume1,158,721
30 Day Avg. Volume1,398,316
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap0.63
Enterprise Value/Revenue23.24
Enterprise Value/Gross Profit58.77
Enterprise Value/Ebitda96.91
Forecast
1Y Price Target
$81.00Price Target Upside-5.58% Downside
Rating ConsensusStrong Buy
Number of Analyst Covering6
Karman Holdings Inc. Business Overview & Revenue Model
Company DescriptionKarman Holdings Inc., through its subsidiary, Karman Space and Defense, engages in designing, testing, manufacturing, and sale of mission-critical systems for missile and defense, space programs, hypersonic, and launch vehicle markets. It also supplies metallic and composite flight hardware and sub-assemblies. In addition, the company provides solutions for payload protection and deployment systems, aerodynamic interstage systems, and propulsion systems. The company was incorporated in 2020 and is based in Huntington Beach, California. Karman Holdings Inc. is a subsidiary of TCFIII Spaceco SPV LP.
How the Company Makes MoneyKarman Holdings Inc. generates revenue through multiple streams, primarily from the sale of its consumer products across different categories. The company's core revenue model includes direct sales through both online platforms and brick-and-mortar retail partnerships. Additionally, Karman Holdings benefits from strategic collaborations with other brands and retailers, which expand its market reach and distribution capabilities. The company also explores licensing agreements for its proprietary technologies and products, providing an additional revenue source. Key factors contributing to its earnings include product innovation, effective marketing strategies, and a strong supply chain management that ensures efficient production and distribution.
Karman Holdings Inc. Earnings Call Summary
Earnings Call Date:Aug 07, 2025
(Q1-2025)
| % Change Since: |
Next Earnings Date:Nov 06, 2025
Earnings Call Sentiment Positive
Karman Space & Defense showcased strong financial performance with record revenue and backlog, successful strategic initiatives including an IPO and debt refinancing, and strong positioning in defense and space markets. However, there are challenges related to share-based compensation impacting net income, uncertainties in government policies, and declining revenue from the SLS program.Q1-2025 Updates
Positive Updates
Record Quarterly Financial Results
Karman Space & Defense reported record quarterly revenue of $100 million, a 20.6% year-over-year increase, and gross profit of $39.5 million. Adjusted EBITDA reached $30.3 million, representing a 30% margin and a 25% year-over-year increase.
Significant Backlog and Revenue Visibility
The company achieved a record funded backlog of $636 million at the end of the first quarter and increased full-year 2025 revenue visibility to approximately 95% as of the end of April.
Strong Performance Across End Markets
Revenue in hypersonics and strategic missile defense grew by 21.1%, tactical missiles and integrated defense systems increased by 29.6%, and space and launch revenue grew by 12% year-over-year.
Successful IPO and Debt Refinancing
Karman successfully completed its IPO and refinanced its debt, reducing interest rates and extending maturities, which strengthened the balance sheet with $113.7 million in cash and cash equivalents.
Positive Demand Signals and Strategic Alignment
The company is well-positioned to benefit from increased defense spending, strong demand signals, and alignment with major space opportunities and national security priorities.
Negative Updates
Impact of Share-Based Compensation on Net Income
Approximately $8 million of share-based compensation expense related to the IPO affected net income, leading to increased general and administrative expenses and a net loss in the quarter.
Uncertainty in Government Initiatives
Potential impacts from trade and government efficiency initiatives, tariffs, and rare earth metal export limitations present risks, although Karman believes it is well-positioned to manage these challenges.
Decline in SLS Program Revenue
Revenue from the SLS program has significantly decreased and is expected to remain negligible in future forecasts.
Company Guidance
During the Karman Space & Defense First Quarter Fiscal Year 2025 Earnings Conference Call, the company reported record quarterly revenue of $100 million and a gross profit of $39.5 million, with an adjusted EBITDA of $30 million and fully diluted adjusted earnings per share of $0.05. They achieved a record funded backlog of $636 million, increasing their revenue visibility for the full year 2025 to approximately 95% by the end of April. Year-over-year, the revenue increased by 20.6%, with notable growth in the hypersonics and strategic missile defense sector (21.1% increase), tactical missiles and integrated defense systems (29.6% increase), and space and launch sector (12% growth). The company expects a statutory tax rate of 24% and CapEx investments to represent 4% of revenue. For fiscal year 2025, Karman reaffirmed its guidance of total revenue between $423 million and $433 million, with adjusted EBITDA projected between $132 million and $137 million, representing growth rates of 24% and 27% respectively.Karman Holdings Inc. Financial Statement Overview
Summary
Karman Holdings Inc. shows strong revenue and profit growth with efficient operations. However, high leverage and negative equity pose significant financial risks. Improvements in cash flow are promising, but financial stability needs attention.Income Statement
Karman Holdings Inc. has demonstrated strong revenue growth, with a significant increase from 2023 to 2024. The company's gross profit margin remains healthy, indicating efficient cost management. Net profit margin shows improvement, turning positive in 2024, which is a notable achievement. EBIT and EBITDA margins are robust, reflecting solid operational performance.78
Positive
Balance Sheet
The balance sheet reveals high leverage, with a substantial debt-to-equity ratio due to negative equity, posing a risk. However, the company's assets have grown, showing expansion potential. The negative stockholders' equity is a concern, indicating potential financial instability.40
Negative
Cash Flow
The cash flow statement shows positive free cash flow growth and improved operating cash flow, which are positive indicators of liquidity and operational efficiency. However, reliance on financing activities and previous negative free cash flow highlight potential cash flow management challenges.65
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 |
|---|---|---|---|---|
Income Statement | ||||
| Total Revenue | 306.46M | 345.25M | 280.71M | 226.31M |
| Gross Profit | 121.20M | 132.11M | 105.55M | 80.95M |
| EBITDA | 73.51M | 96.36M | 75.67M | 55.42M |
| Net Income | 3.69M | 12.70M | 4.36M | -14.10M |
Balance Sheet | ||||
| Total Assets | 953.93M | 773.96M | 710.83M | 682.59M |
| Cash, Cash Equivalents and Short-Term Investments | 27.44M | 11.53M | 5.45M | 6.63M |
| Total Debt | 485.78M | 447.87M | 409.33M | 403.58M |
| Total Liabilities | 504.29M | 577.96M | 528.37M | 505.00M |
| Stockholders Equity | 449.64M | 196.00M | 182.46M | 177.60M |
Cash Flow | ||||
| Free Cash Flow | -36.18M | 11.39M | 3.55M | -27.16M |
| Operating Cash Flow | -23.40M | 26.65M | 20.33M | -5.89M |
| Investing Cash Flow | -145.21M | -46.24M | -16.21M | -21.26M |
| Financing Cash Flow | 188.37M | 25.67M | -5.29M | 16.73M |
Karman Holdings Inc. Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
| ― | $6.62B | 31.94 | 11.32% | 0.55% | 4.77% | 4.50% | |
| ― | $7.48B | 170.15 | 4.70% | ― | 26.15% | 251.10% | |
| ― | $5.65B | 86.05 | 4.36% | 1.04% | -0.37% | -34.97% | |
| ― | $11.35B | ― | ― | ― | ― | ― | |
| ― | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
| ― | $5.33B | 102.43 | 2.20% | ― | ― | ― | |
| ― | $4.27B | -1.81 | ― | ― | -2.60% | -94.76% |
* Industrials Sector Average
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Karman Holdings Inc. Corporate Events
Karman Holdings Inc. Reports Record Q2 2025 Results
Aug 8, 2025
Karman Holdings Inc., a prominent player in the space and defense sector, specializes in the rapid design, development, and production of next-generation system solutions for a variety of aerospace and defense applications.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.