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LEONARDO DRS INC (DRS) Stock Fundamental Analysis

NASDAQ:DRS - Nasdaq - US52661A1088 - Common Stock - Currency: USD

47.57  +1.33 (+2.88%)

After market: 47.8 +0.23 (+0.48%)

Fundamental Rating

6

DRS gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 65 industry peers in the Aerospace & Defense industry. While DRS has a great health rating, its profitability is only average at the moment. While showing a medium growth rate, DRS is valued expensive at the moment.


Dividend Valuation Growth Profitability Health

6

1. Profitability

1.1 Basic Checks

DRS had positive earnings in the past year.
In the past year DRS had a positive cash flow from operations.
DRS had positive earnings in each of the past 5 years.
DRS had a positive operating cash flow in 4 of the past 5 years.
DRS Yearly Net Income VS EBIT VS OCF VS FCFDRS Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 200M 400M 600M 800M

1.2 Ratios

The Return On Assets of DRS (5.71%) is better than 72.31% of its industry peers.
DRS has a Return On Equity of 9.10%. This is in the better half of the industry: DRS outperforms 66.15% of its industry peers.
DRS's Return On Invested Capital of 8.58% is fine compared to the rest of the industry. DRS outperforms 73.85% of its industry peers.
DRS had an Average Return On Invested Capital over the past 3 years of 14.80%. This is significantly above the industry average of 8.44%.
The last Return On Invested Capital (8.58%) for DRS is well below the 3 year average (14.80%), which needs to be investigated, but indicates that DRS had better years and this may not be a problem.
Industry RankSector Rank
ROA 5.71%
ROE 9.1%
ROIC 8.58%
ROA(3y)6.8%
ROA(5y)7.59%
ROE(3y)11.53%
ROE(5y)11.69%
ROIC(3y)14.8%
ROIC(5y)12.07%
DRS Yearly ROA, ROE, ROICDRS Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 -20 -40 -60

1.3 Margins

DRS has a better Profit Margin (7.00%) than 67.69% of its industry peers.
In the last couple of years the Profit Margin of DRS has declined.
With a decent Operating Margin value of 9.36%, DRS is doing good in the industry, outperforming 63.08% of the companies in the same industry.
DRS's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 22.84%, DRS is in line with its industry, outperforming 43.08% of the companies in the same industry.
DRS's Gross Margin has declined in the last couple of years.
Industry RankSector Rank
OM 9.36%
PM (TTM) 7%
GM 22.84%
OM growth 3Y-18.83%
OM growth 5YN/A
PM growth 3Y-32.5%
PM growth 5YN/A
GM growth 3Y-17.5%
GM growth 5Y-8.71%
DRS Yearly Profit, Operating, Gross MarginsDRS Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 -20 40 -40

7

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), DRS is creating some value.
DRS has more shares outstanding than it did 1 year ago.
The number of shares outstanding for DRS has been increased compared to 5 years ago.
DRS has a better debt/assets ratio than last year.
DRS Yearly Shares OutstandingDRS Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 50M 100M 150M 200M 250M
DRS Yearly Total Debt VS Total AssetsDRS Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B 4B

2.2 Solvency

An Altman-Z score of 5.35 indicates that DRS is not in any danger for bankruptcy at the moment.
With a decent Altman-Z score value of 5.35, DRS is doing good in the industry, outperforming 63.08% of the companies in the same industry.
The Debt to FCF ratio of DRS is 1.24, which is an excellent value as it means it would take DRS, only 1.24 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of DRS (1.24) is better than 95.38% of its industry peers.
DRS has a Debt/Equity ratio of 0.13. This is a healthy value indicating a solid balance between debt and equity.
DRS's Debt to Equity ratio of 0.13 is fine compared to the rest of the industry. DRS outperforms 80.00% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.13
Debt/FCF 1.24
Altman-Z 5.35
ROIC/WACC0.83
WACC10.39%
DRS Yearly LT Debt VS Equity VS FCFDRS Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 500M 1B 1.5B 2B 2.5B

2.3 Liquidity

DRS has a Current Ratio of 2.02. This indicates that DRS is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of DRS (2.02) is comparable to the rest of the industry.
DRS has a Quick Ratio of 1.64. This is a normal value and indicates that DRS is financially healthy and should not expect problems in meeting its short term obligations.
DRS has a better Quick ratio (1.64) than 63.08% of its industry peers.
Industry RankSector Rank
Current Ratio 2.02
Quick Ratio 1.64
DRS Yearly Current Assets VS Current LiabilitesDRS Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 500M 1B 1.5B 2B

6

3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 25.00% over the past year.
DRS shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 23.42% yearly.
Looking at the last year, DRS shows a quite strong growth in Revenue. The Revenue has grown by 13.58% in the last year.
DRS shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 135.87% yearly.
EPS 1Y (TTM)25%
EPS 3Y23.42%
EPS 5YN/A
EPS Q2Q%42.86%
Revenue 1Y (TTM)13.58%
Revenue growth 3Y202.18%
Revenue growth 5Y135.87%
Sales Q2Q%16.13%

3.2 Future

DRS is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.12% yearly.
Based on estimates for the next years, DRS will show a small growth in Revenue. The Revenue will grow by 6.63% on average per year.
EPS Next Y15.51%
EPS Next 2Y16.12%
EPS Next 3Y13.82%
EPS Next 5Y9.12%
Revenue Next Year10.11%
Revenue Next 2Y8.23%
Revenue Next 3Y7.31%
Revenue Next 5Y6.63%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
DRS Yearly Revenue VS EstimatesDRS Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 1B 2B 3B 4B
DRS Yearly EPS VS EstimatesDRS Yearly EPS VS EstimatesYearly EPS VS Estimates 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 0 0.5 1

3

4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 47.57 indicates a quite expensive valuation of DRS.
Compared to the rest of the industry, the Price/Earnings ratio of DRS is on the same level as its industry peers.
DRS is valuated expensively when we compare the Price/Earnings ratio to 27.30, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 37.53, DRS can be considered very expensive at the moment.
DRS's Price/Forward Earnings ratio is in line with the industry average.
When comparing the Price/Forward Earnings ratio of DRS to the average of the S&P500 Index (21.76), we can say DRS is valued expensively.
Industry RankSector Rank
PE 47.57
Fwd PE 37.53
DRS Price Earnings VS Forward Price EarningsDRS Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60

4.2 Price Multiples

DRS's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, DRS is valued a bit cheaper than 72.31% of the companies in the same industry.
Industry RankSector Rank
P/FCF 43.49
EV/EBITDA 30.33
DRS Per share dataDRS EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 2 4 6 8 10

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates DRS does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of DRS may justify a higher PE ratio.
DRS's earnings are expected to grow with 13.82% in the coming years. This may justify a more expensive valuation.
PEG (NY)3.07
PEG (5Y)N/A
EPS Next 2Y16.12%
EPS Next 3Y13.82%

3

5. Dividend

5.1 Amount

With a yearly dividend of 0.78%, DRS is not a good candidate for dividend investing.
DRS's Dividend Yield is rather good when compared to the industry average which is at 1.24. DRS pays more dividend than 83.08% of the companies in the same industry.
With a Dividend Yield of 0.78, DRS pays less dividend than the S&P500 average, which is at 2.37.
Industry RankSector Rank
Dividend Yield 0.78%

5.2 History

DRS does not have a reliable dividend history as it only pays dividend since a couple or years.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
DRS Yearly Dividends per shareDRS Yearly Dividends per shareYearly Dividends per share 2025 0.05 0.1 0.15

5.3 Sustainability

DRS pays out 10.26% of its income as dividend. This is a sustainable payout ratio.
DP10.26%
EPS Next 2Y16.12%
EPS Next 3Y13.82%
DRS Yearly Income VS Free CF VS DividendDRS Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 100M 200M 300M 400M
DRS Dividend Payout.DRS Dividend Payout, showing the Payout Ratio.DRS Dividend Payout.PayoutRetained Earnings

LEONARDO DRS INC

NASDAQ:DRS (7/11/2025, 8:06:01 PM)

After market: 47.8 +0.23 (+0.48%)

47.57

+1.33 (+2.88%)

Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)05-01 2025-05-01/bmo
Earnings (Next)07-30 2025-07-30/amc
Inst Owners26.82%
Inst Owner Change0%
Ins Owners0.33%
Ins Owner Change30.75%
Market Cap12.66B
Analysts81.54
Price Target47.65 (0.17%)
Short Float %3.56%
Short Ratio2.1
Dividend
Industry RankSector Rank
Dividend Yield 0.78%
Yearly Dividend0
Dividend Growth(5Y)N/A
DP10.26%
Div Incr Years0
Div Non Decr Years0
Ex-Date05-22 2025-05-22 (0.09)
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)13.18%
Min EPS beat(2)6.36%
Max EPS beat(2)20.01%
EPS beat(4)4
Avg EPS beat(4)19.76%
Min EPS beat(4)6.36%
Max EPS beat(4)30.8%
EPS beat(8)8
Avg EPS beat(8)21.1%
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)2
Avg Revenue beat(2)5.23%
Min Revenue beat(2)3.09%
Max Revenue beat(2)7.38%
Revenue beat(4)4
Avg Revenue beat(4)5.93%
Min Revenue beat(4)3.09%
Max Revenue beat(4)9.58%
Revenue beat(8)7
Avg Revenue beat(8)4.28%
Revenue beat(12)10
Avg Revenue beat(12)328.61%
Revenue beat(16)12
Avg Revenue beat(16)363.02%
PT rev (1m)8.28%
PT rev (3m)22.47%
EPS NQ rev (1m)0.2%
EPS NQ rev (3m)0%
EPS NY rev (1m)-0.31%
EPS NY rev (3m)1.06%
Revenue NQ rev (1m)0.29%
Revenue NQ rev (3m)1.9%
Revenue NY rev (1m)-0.08%
Revenue NY rev (3m)0.91%
Valuation
Industry RankSector Rank
PE 47.57
Fwd PE 37.53
P/S 3.78
P/FCF 43.49
P/OCF 31.8
P/B 4.92
P/tB 10.49
EV/EBITDA 30.33
EPS(TTM)1
EY2.1%
EPS(NY)1.27
Fwd EY2.66%
FCF(TTM)1.09
FCFY2.3%
OCF(TTM)1.5
OCFY3.14%
SpS12.57
BVpS9.66
TBVpS4.54
PEG (NY)3.07
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 5.71%
ROE 9.1%
ROCE 10.2%
ROIC 8.58%
ROICexc 9.79%
ROICexgc 19.86%
OM 9.36%
PM (TTM) 7%
GM 22.84%
FCFM 8.7%
ROA(3y)6.8%
ROA(5y)7.59%
ROE(3y)11.53%
ROE(5y)11.69%
ROIC(3y)14.8%
ROIC(5y)12.07%
ROICexc(3y)17.19%
ROICexc(5y)16.27%
ROICexgc(3y)41.83%
ROICexgc(5y)31.06%
ROCE(3y)17.68%
ROCE(5y)14.42%
ROICexcg growth 3Y5.24%
ROICexcg growth 5YN/A
ROICexc growth 3Y-19.58%
ROICexc growth 5YN/A
OM growth 3Y-18.83%
OM growth 5YN/A
PM growth 3Y-32.5%
PM growth 5YN/A
GM growth 3Y-17.5%
GM growth 5Y-8.71%
F-Score8
Asset Turnover0.82
Health
Industry RankSector Rank
Debt/Equity 0.13
Debt/FCF 1.24
Debt/EBITDA 0.83
Cap/Depr 116.3%
Cap/Sales 3.2%
Interest Coverage 250
Cash Conversion 98.27%
Profit Quality 124.36%
Current Ratio 2.02
Quick Ratio 1.64
Altman-Z 5.35
F-Score8
WACC10.39%
ROIC/WACC0.83
Cap/Depr(3y)88%
Cap/Depr(5y)129.75%
Cap/Sales(3y)2.39%
Cap/Sales(5y)3.79%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)25%
EPS 3Y23.42%
EPS 5YN/A
EPS Q2Q%42.86%
EPS Next Y15.51%
EPS Next 2Y16.12%
EPS Next 3Y13.82%
EPS Next 5Y9.12%
Revenue 1Y (TTM)13.58%
Revenue growth 3Y202.18%
Revenue growth 5Y135.87%
Sales Q2Q%16.13%
Revenue Next Year10.11%
Revenue Next 2Y8.23%
Revenue Next 3Y7.31%
Revenue Next 5Y6.63%
EBIT growth 1Y23.23%
EBIT growth 3Y145.27%
EBIT growth 5YN/A
EBIT Next Year43.33%
EBIT Next 3Y21.71%
EBIT Next 5Y15.46%
FCF growth 1Y357.52%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y965.22%
OCF growth 3YN/A
OCF growth 5YN/A