So Kratos stock dropped 5% on Wednesday even though KeyBanc just raised their price target to $130? That's the kind of disconnect that makes you wonder what's really going on here. The analyst is calling it an outperform, citing all this growth in space and defense spending, but I'm looking at the actual numbers and something feels off. Kratos has definitely grown revenues nicely over five years, hitting about $1.3 billion recently. But here's the thing - they're barely making money on those sales. Last year they reported $20 million in net income, which is actually down from $79.6 million back in 2020. That's a pretty big red flag if you ask me. And the free cash flow situation? Negative $93.3 million over the past 12 months. The company is still burning through cash despite all that revenue growth. I get that analysts are projecting earnings could hit $60 million by 2026, which would be triple what they're making now. But even if Kratos hits that target, at current valuations you're looking at paying 333 times forward earnings. That's just insane for a company that's still losing money operationally. Sure, space and defense are hot sectors right now, but valuations matter. I can't see how Kratos stock at these levels is anything other than expensive. The growth story is real, but the price isn't reflecting the actual profitability yet.