Leonardo DRS Inc Dossier - Source-backed chat

Leonardo DRS Inc

DRSNASDAQ

SectorIndustrials

IndustryAerospace & Defense

Beta (adjusted)0.59

Intrinsic Value $34.76median of 6 methods · middle span $21-$69based on filings through 30 Jun 2026

Market Price $36.76Price as of 1 Oct 2026

Near fair valueIntrinsic value is 5% below the market price

−50% · IV below pricenear fair value ±15%IV above price · +50%

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Market Cap $9.8B

Enterprise Value $9.9B

Shares Outstanding 268.6M diluted

Moat Rating Wide

Next Earnings Date29 Oct 2026

Last ex-dividend13 Aug 2026

All prices and values are periodic snapshots, not live quotes. Source dates are shown for reference.

Thesis

Street consensus, scenarios, merits, risks, and invalidation triggers

AI-assisted

Thesis Summary

Leonardo DRS entered September 2026 with strong operating momentum: second-quarter revenue increased 10%, funded backlog reached a record $5.092 billion, book-to-bill was 1.2x and adjusted EBITDA margin expanded to 14.0%. Management consequently raised adjusted EBITDA and adjusted EPS guidance. The proposed Raft acquisition could extend DRS from differentiated defense hardware into open-architecture mission software, data fusion and AI, while the September 1 Space Force prototype award provides additional evidence of demand for its advanced sensing capabilities.

This section is the 12-month view: analyst targets and the probability-weighted scenarios built from them. The intrinsic value at the top of this page answers a different question: what the business is worth today.

Street view · analyst 12-month targets10 analysts · as of 18 Aug 2026

Low · most bearish analyst$47.00

Mean target$54.10

High · most bullish analyst$59.00

Street targets sit above today's price; our intrinsic value sits below it. Different horizons, different questions.

Our research · scenarios, merits, risks, and invalidation triggersResearch as of 2 Sep 2026

Scenarios · 12-month scenario targetsAnchored at research date

Bear CaseDownside scenario

$47.0018%

Program delays or weaker backlog conversion push revenue below the guidance floor, while fixed-price execution, supply-chain or government-funding pressures reduce profitability. A delayed Raft closing or higher integration and financing costs would weaken the strategic and earnings-accretion rationale.

Base CaseCentral scenario

$54.1058%

Matches the consensus mean

Leonardo DRS delivers within its $3.900 billion-$3.975 billion revenue range, with backlog and bookings supporting continued growth but normal program timing and working-capital variability. Raft closes substantially on the announced timetable, although integration benefits emerge gradually.

Bull CaseUpside scenario

$59.0024%

Revenue reaches the upper end of company guidance, record funded backlog converts on schedule, recent sensing awards progress toward production opportunities, and Raft closes during the fourth quarter and becomes accretive in its first full year of ownership. Continued favorable mix and program execution preserve the margin improvement demonstrated in the second quarter.

Scenarios are anchored to street consensus at the research date, with our probabilities and rationale.

Key Investment Merits

Funded backlog reached a record $5.092 billion, up 17% year over year, while second-quarter bookings of $1.085 billion produced a 1.2x book-to-bill ratio.
Second-quarter adjusted EBITDA increased 33% and adjusted EBITDA margin reached 14.0%, prompting management to raise full-year adjusted EBITDA and adjusted EPS guidance.
The proposed Raft acquisition would add open-architecture mission software, multi-domain data fusion and AI capabilities, while the September 1 Space Force prototype award extends DRS's advanced-sensing opportunity set.

Key Investment Risks

The business remains exposed to U.S. government appropriations, program priorities, partial contract funding and termination rights.
Fixed-price program execution, component availability, labor costs and supply-chain delays could reduce backlog conversion and margins.
Raft remains subject to regulatory approvals and closing conditions, followed by personnel-retention, integration, financing-cost and benefit-realization risks.

All scenarios are estimates and subject to change. Past performance is not indicative of future results.

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Explore this dossier

ValuationIntrinsic value, the six-method breakdown, peer medians, and your assumptions sandbox.Financial SnapshotRevenue, profitability, returns, balance sheet, dividends, and the filing-level detail.Qualitative AnalysisBusiness overview, strategic initiatives, and mergers, acquisitions & partnerships.Outlook & Key DatesForward estimates, reporting calendar, and the monitoring framework.