Update shared on 14 Dec 2025
Fair value Decreased 1.96%Analysts have trimmed their price target on Leonardo DRS by 1.96 percent, from 51.00 dollars to 50.00 dollars. This reflects slightly more conservative assumptions on the discount rate and revenue growth, partially offset by improved profit margin expectations and a lower projected future P/E multiple.
What's in the News
- Signed a Memorandum of Intent with Saudi Arabia's Ministry of Defense to collaborate on advanced networked combat vehicle and dismounted soldier systems as part of the Kingdom's Vision 2030 defense modernization roadmap (company announcement).
- Entered a strategic cooperation agreement with Axon Vision to co-develop AI enabled situational awareness and Counter UAS solutions for U.S. defense customers, integrating sensors, rugged processors, and kinetic and non-kinetic effectors (company announcement).
- Awarded a contract from Chaiseri Defense Systems to supply advanced battle management systems and integration support to modernize the Royal Thailand Army's Stryker situational awareness capabilities (company announcement).
- Formed a strategic partnership intent with Hofmann Engineering to jointly pursue next generation naval electric and hybrid propulsion opportunities, supporting U.S. and allied shipbuilding and the AUKUS alliance (company announcement).
- Won a U.S. Army contract to develop Vehicle Integrated Power Kits based on its TITAN on board vehicle power solution, enabling up to 120 kW of exportable power from tactical vehicles for high demand systems such as radar, directed energy, and counter UAS (company announcement).
Valuation Changes
- Fair Value: reduced slightly from $51.00 to $50.00 per share, reflecting a more conservative valuation assumption.
- Discount Rate: increased moderately from 7.13 percent to approximately 7.64 percent. This implies a higher required return and marginally lower present value of future cash flows.
- Revenue Growth: lowered meaningfully from about 7.39 percent to roughly 6.00 percent. This indicates more cautious expectations for top line expansion.
- Net Profit Margin: improved from around 8.60 percent to about 9.67 percent. This signals stronger anticipated profitability despite slower revenue growth.
- Future P/E: reduced from approximately 48.0x to about 40.7x. This suggests a more conservative multiple applied to projected earnings.
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