Telos Corporation (TLS)
NASDAQ:TLS
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Telos
(NASDAQ:TLS)
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Rating:64Neutral
Price Target:
$4.50
▲(3.21% Upside)
Action:Reiterated
Date:05/29/26
TLS scores strongest on improving fundamentals and execution: strong operating/free cash flow and low leverage provide financial flexibility, and the earnings call highlighted significant revenue growth, margin expansion, and ongoing buybacks. Offsetting these positives, GAAP profitability remains meaningfully negative and the stock’s longer-term technical trend is still pressured (below the 200-day average), with valuation support limited by a negative P/E.
Positive Factors
Strong cash generation
Consistently positive operating and free cash flow provides durable financial flexibility: it funds investments, supports buybacks and a target cash balance, and cushions the business while GAAP profitability recovers, reducing reliance on external financing over the next 2–6 months.
Negative Factors
Persistent GAAP losses
Ongoing GAAP losses and negative margins constrain retained earnings and long-term return metrics, limiting reinvestment and making sustained profitability improvements necessary to convert strong cash flow into consistent GAAP viability and restore returns on equity.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation
Consistently positive operating and free cash flow provides durable financial flexibility: it funds investments, supports buybacks and a target cash balance, and cushions the business while GAAP profitability recovers, reducing reliance on external financing over the next 2–6 months.
Read all positive factors
Telos (TLS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$338.93M
Dividend YieldN/A
Average Volume (3M)882.74K
Price to Earnings (P/E)―
Beta (1Y)2.88
Revenue Growth66.50%
EPS Growth52.19%
CountryUS
Employees504
SectorTechnology
Sector Strength88
IndustryInformation Technology Services
Share Statistics
EPS (TTM)-0.35
Shares Outstanding74,819,176
10 Day Avg. Volume1,171,038
30 Day Avg. Volume882,735
Financial Highlights & Ratios
PEG Ratio0.32
Price to Book (P/B)3.87
Price to Sales (P/S)2.26
P/FCF Ratio12.62
Enterprise Value/Market Cap0.92
Enterprise Value/Revenue1.72
Enterprise Value/Gross Profit4.72
Enterprise Value/Ebitda-23.21
Forecast
1Y Price Target
$6.83Price Target Upside56.73% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
EPS Forecast (FY)0.13
Revenue Forecast (FY)$194.02M
Telos Business Overview & Revenue Model
Company Description
Telos Corporation is a global provider of information technology solutions and services. A cornerstone offering is Xacta, a leading platform for automated cyber risk management and security compliance, serving major commercial organizations and go...
How the Company Makes Money
Telos makes money primarily by delivering cybersecurity and IT solutions under contracts, with revenue largely tied to U.S. federal government spending. Key revenue streams include: (1) contract-based professional and managed services (e.g., cyber...
Telos Earnings Call Summary
Earnings Call Date:May 11, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 06, 2026
Earnings Call Sentiment Positive
The call conveyed strong operational and financial momentum: sizable revenue growth (+56%), materially improved adjusted EBITDA margin (16.5% vs 1.2% prior year), robust cash generation (13.4% free cash flow margin) and accelerated share buybacks. Key growth drivers (Telos ID, TSA PreCheck, DMDC) performed well and a sizable ~$500M pipeline and Exact AI traction offer upside. Offsetting factors include the CEO's medical leave (interim leadership), conservative approach to updating full-year guidance despite the beat, timing uncertainty around government awards, and seasonality risk in TSA PreCheck. Overall, the positives — large beat, margin expansion, strong cash flow, buybacks and a meaningful pipeline — substantially outweigh the manageable risks and uncertainties.Positive Updates
Revenue Growth and Guidance Beat
Total company revenue increased 56% year over year to $47.7 million, exceeding guidance of $44.0M–$45.0M for the quarter.
Negative Updates
CEO Medical Leave and Leadership Transition
Chairman and CEO John B. Wood is on medical leave; interim responsibilities assumed by the executive team. Management reports smooth transition, but the absence of the CEO introduces short-term leadership risk and uncertainty.
Read all updates
Q1-2026 Updates
Positive
Negative
Revenue Growth and Guidance Beat
Total company revenue increased 56% year over year to $47.7 million, exceeding guidance of $44.0M–$45.0M for the quarter.
Read all positive updates
Company Guidance
For the second quarter Telos guided revenue of $44–$46 million (up 22%–28% YoY), cash gross margin of ~39%, adjusted operating expenses down roughly $1.3 million YoY, and adjusted EBITDA of $5–$6 million (11.4%–13% margin); management reaffirmed its full‑year revenue and adjusted EBITDA outlook while raising the low end of cash gross margin assumptions after a Q1 beat where revenue was $47.7 million (+56% YoY vs prior guidance $44–$45M), GAAP gross margin 36.4%, cash gross margin 42.3%, adjusted EBITDA $7.9M (16.5% margin vs 1.2% prior year), adjusted OPEX $400k better than guidance and down $1.2M YoY, operating cash flow $8.7M, free cash flow $6.4M (13.4% FCF margin and fifth consecutive quarter above 12%), $2.2M of repurchases (500k+ shares at $4.25 avg) with plans to accelerate buybacks, nearly $500M of proposals outstanding with awards expected in 2026, and a target cash balance of approximately $50M with continued lower‑double‑digit FCF margins anticipated.Telos Financial Statement Overview
Summary
Income Statement
34
Negative
Balance Sheet
68
Positive
Cash Flow
72
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 181.93M | 164.81M | 108.27M | 145.38M | 216.89M | 242.43M |
| Gross Profit | 66.36M | 61.02M | 34.43M | 52.94M | 79.04M | 86.03M |
| EBITDA | -13.50M | -25.20M | -39.98M | -24.17M | -46.61M | -36.76M |
| Net Income | -25.92M | -36.55M | -52.52M | -34.42M | -53.43M | -43.13M |
Balance Sheet | ||||||
| Total Assets | 139.90M | 139.86M | 158.24M | 208.70M | 237.40M | 246.08M |
| Cash, Cash Equivalents and Short-Term Investments | 50.23M | 53.18M | 54.58M | 99.26M | 119.31M | 126.56M |
| Total Debt | 5.20M | 8.06M | 10.15M | 11.47M | 21.69M | 15.25M |
| Total Liabilities | 43.36M | 43.91M | 31.10M | 49.70M | 65.04M | 65.83M |
| Stockholders Equity | 96.53M | 95.95M | 127.14M | 159.00M | 172.35M | 180.25M |
Cash Flow | ||||||
| Free Cash Flow | 27.72M | 29.44M | -28.19M | -13.89M | 2.79M | -5.91M |
| Operating Cash Flow | 32.71M | 30.18M | -25.94M | 1.59M | 16.51M | 7.26M |
| Investing Cash Flow | -8.86M | -8.91M | -16.76M | -15.48M | -13.72M | -19.09M |
| Financing Cash Flow | -31.42M | -22.66M | -1.98M | -6.15M | -9.91M | 32.35M |
Telos Technical Analysis
Neutral
4.36
Price Trends
4.42
Positive
4.49
Positive
5.36
Negative
Market Momentum
0.02
Positive
51.25
Neutral
35.54
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TLS, the sentiment is Neutral. The current price of 4.36 is below the 20-day moving average (MA) of 4.59, below the 50-day MA of 4.42, and below the 200-day MA of 5.36, indicating a neutral trend. The MACD of 0.02 indicates Positive momentum. The RSI at 51.25 is Neutral, neither overbought nor oversold. The STOCH value of 35.54 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TLS.
Telos Risk Analysis
Telos disclosed 43 risk factors in its most recent earnings report. Telos reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Telos Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
68 Neutral | $204.75M | 19.02 | 11.20% | 3.03% | 1.41% | 39.19% | |
64 Neutral | $338.93M | -13.02 | -24.08% | ― | 66.50% | 52.19% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
59 Neutral | $344.19M | 20.73 | 25.27% | ― | -12.59% | 33.81% | |
57 Neutral | $271.28M | 19.66 | 15.84% | 2.41% | -5.71% | -38.81% | |
51 Neutral | $207.83M | -1.30 | -19.59% | ― | -5.40% | -172.56% | |
48 Neutral | $277.04M | -0.80 | 125.36% | ― | 0.15% | -359.97% |
* Technology Sector Average
TLS
Telos
4.57
1.87
69.26%
III
Information Services Group
4.21
-0.34
-7.49%
HCKT
The Hackett Group
11.00
-12.48
-53.16%
UIS
Unisys
3.85
-0.58
-13.09%
CNDT
Conduent
1.40
-1.27
-47.57%
TSSI
TSS
12.78
-5.61
-30.51%
Telos Corporate Events
Executive/Board Changes
Telos CEO John Wood Returns, Leadership Structure Restored
Positive
May 28, 2026
Telos Corporation announced that effective May 28, 2026, President, Chief Executive Officer and Chairman John B. Wood has returned from medical leave and resumed his full duties, including the chairmanship of the board. His return ends the interim...
Executive/Board ChangesShareholder Meetings
Telos Shareholders Reaffirm Board, Compensation and Governance Policies
Positive
May 7, 2026
On May 7, 2026, Telos Corporation stockholders elected seven directors to serve until the 2027 annual meeting, reaffirming the existing board leadership with each nominee receiving a plurality of votes cast. Shareholders also ratified Pricewaterho...
Business Operations and StrategyExecutive/Board ChangesFinancial Disclosures
Telos Announces Interim Leadership Structure Amid CEO Leave
Positive
Apr 29, 2026
Telos Corporation announced that President, Chief Executive Officer and Board Chairman John B. Wood has taken a medical leave of absence of uncertain duration, prompting an interim leadership structure effective April 28, 2026. Executive Vice Pres...
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.