Telos (TLS) AI Stock Analysis

• Market Cap: $477.66M
• Dividend Yield: N/A
• Average Volume (3M): 2.14M
• Price to Earnings (P/E): ―
• Beta (1Y): 2.88
• Revenue Growth: -13.76%
• EPS Growth: -75.18%
• Country: US
• Employees: 504
• Sector: Technology
• Sector Strength: 83
• Industry: Information Technology Services
• EPS (TTM): -0.03
• Shares Outstanding: 72,703,010
• 10 Day Avg. Volume: 1,412,172
• 30 Day Avg. Volume: 2,137,581
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.39
• Enterprise Value/Revenue: 1.58
• Enterprise Value/Gross Profit: 4.86
• Enterprise Value/Ebitda: -4.11
• 1Y Price Target: $5.46
• Price Target Upside: -16.89% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

• Rating: 58 Neutral
• Price Target: $6.00 ▼(-8.68% Downside)

Telos's overall stock score is primarily driven by the strong positive outlook from the recent earnings call, which highlights significant revenue growth and improved cash flow. However, the financial performance remains a major concern due to persistent losses and negative cash flows. The technical analysis indicates strong bullish momentum, but the valuation is unattractive due to a negative P/E ratio and lack of dividend yield.

Positive Factors

Earnings

TLS delivered $36 million of total revenue, above the high end of guidance of $34.5 million.

Financial Performance

Security Solutions revenue grew 82% year over year, driven by solid execution on large programs including TSA PreCheck.

Guidance

TLS guided September quarter revenue to $45.5 million at the mid-point, which was meaningfully above consensus estimates.

Negative Factors

Cash Flow

There is great uncertainty to durable revenue growth and cash flow generation.

Contract Run-offs

Secure Networks revenues declined significantly primarily due to contract run-offs.

Government Spending

The government is exhibiting caution on spend, which impacts new business for TLS.

Telos Business Overview & Revenue Model

Company Description

Telos Corporation (TLS) is a leading provider of cyber, cloud, and enterprise security solutions for businesses, government agencies, and other organizations. The company specializes in cybersecurity services, IT risk management, secure mobility, and identity management solutions, enabling its clients to protect their critical assets and maintain secure and resilient operations. With a strong focus on innovation, Telos offers a comprehensive suite of services designed to address the complex security challenges faced by its customers in an increasingly digital world.

How the Company Makes Money

Telos Corporation generates revenue through the sale of cybersecurity solutions and services, primarily focusing on government contracts and business enterprises. Key revenue streams include the provision of software-as-a-service (SaaS) offerings, consulting services, and managed security services. Telos's partnerships with technology providers and its long-standing relationships with federal agencies significantly contribute to its earnings. The company also benefits from recurring revenue models associated with its software and service contracts, providing a steady income stream from its diverse client base.

Telos Financial Statement Overview

Summary

Telos faces significant financial challenges, with declining revenues, persistent losses, and negative cash flows. While the company maintains a low leverage ratio, the negative return on equity and cash flow issues highlight the need for strategic improvements to achieve financial stability and growth.

Income Statement

Telos has been experiencing declining revenue over the past few years, with a slight recovery in the TTM period. However, the company continues to face significant profitability challenges, as evidenced by negative net profit margins and EBIT margins. The gross profit margin remains relatively stable, but the overall financial health is impacted by consistent net losses.

Balance Sheet

The balance sheet shows a low debt-to-equity ratio, indicating conservative leverage. However, the return on equity is negative, reflecting ongoing losses and a declining equity base. The equity ratio remains stable, suggesting a solid asset base relative to equity.

Cash Flow

Telos's cash flow situation is concerning, with negative operating cash flow and declining free cash flow growth. The free cash flow to net income ratio is positive in the TTM period, but overall cash flow management remains a challenge, impacting liquidity and operational flexibility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	116.74M	108.27M	145.38M	216.89M	242.43M	179.92M
Gross Profit	37.88M	34.43M	52.94M	79.04M	86.03M	62.42M
EBITDA	-44.78M	-39.98M	-24.17M	-46.61M	-36.76M	19.41M
Net Income	-55.51M	-52.52M	-34.42M	-53.43M	-43.13M	1.69M
Balance Sheet
Total Assets	165.04M	158.24M	208.70M	237.40M	246.08M	183.82M
Cash, Cash Equivalents and Short-Term Investments	57.00M	54.58M	99.26M	119.31M	126.56M	106.05M
Total Debt	6.96M	10.15M	11.47M	21.69M	15.25M	17.26M
Total Liabilities	46.63M	31.10M	49.70M	65.04M	65.83M	56.71M
Stockholders Equity	118.41M	127.14M	159.00M	172.35M	180.25M	127.10M
Cash Flow
Free Cash Flow	-2.81M	-28.19M	-13.89M	2.79M	-5.91M	-9.56M
Operating Cash Flow	-4.54M	-25.94M	1.59M	16.51M	7.26M	-2.10M
Investing Cash Flow	-11.77M	-16.76M	-15.48M	-13.72M	-19.09M	-7.46M
Financing Cash Flow	-6.79M	-1.98M	-6.15M	-9.91M	32.35M	108.86M

Telos Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 6.57
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TLS, the sentiment is Positive. The current price of 6.57 is above the 20-day moving average (MA) of 5.71, above the 50-day MA of 3.99, and above the 200-day MA of 3.21, indicating a bullish trend. The MACD of 0.78 indicates Positive momentum. The RSI at 67.58 is Neutral, neither overbought nor oversold. The STOCH value of 64.24 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TLS.

Telos Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
III	69 Neutral	$254.95M	33.12	8.29%	3.44%	-9.86%	―
TSSI	66 Neutral	$367.03M	36.38	122.80%	―	328.80%	339.87%
Sector *	61 Neutral	$35.52B	8.84	-11.04%	1.87%	8.55%	-8.14%
TLS	58 Neutral	$477.66M	―	-41.49%	―	-13.76%	-75.18%
CSPI	52 Neutral	$114.00M	40,175.00	-3.33%	1.06%	-0.37%	-161.02%
DMRC	44 Neutral	$175.40M	―	-63.65%	―	-8.07%	7.66%
TTEC	44 Neutral	$185.13M	―	-9.11%	1.75%	-8.21%	91.83%

Telos Corporate Events

Telos Reports Strong Q2 2025 Financial Results

Telos Corporation reported its second quarter 2025 financial results on August 11, 2025, leading to a favorable response in its stock price. The company has reassured investors that it has no current plans to raise capital through dilutive securities, citing its strong liquidity position with $57 million in cash and cash equivalents, no outstanding debt, and expected positive cash flow for the remainder of the year.

Telos Appoints DJ Terreri as Principal Accounting Officer

On June 30, 2025, Telos Corporation appointed Mr. Donald Joseph (DJ) Terreri as the controller and chief accounting officer, later designating him as the principal accounting officer on July 8, 2025. Mr. Terreri, who brings extensive experience from his previous roles at CBRE Government and Defense Business, J&J Worldwide Services, ICF International, Privia Health, and Discovery Communications, will report directly to the Executive Vice President and Chief Financial Officer, Mr. Mark Bendza. His appointment is expected to strengthen Telos’s financial leadership and enhance its accounting operations.