Leonardo DRS (NASDAQ:DRS) Posts Quarterly Earnings Results, Beats Estimates By $0.05 EPS

Leonardo DRS (NASDAQ:DRS) issued its earnings results on Tuesday. The company reported $0.26 earnings per share for the quarter, beating analysts’ consensus estimates of $0.21 by $0.05, Briefing.com reports. The firm had revenue of $846.00 million for the quarter, compared to analysts’ expectations of $825.05 million. Leonardo DRS had a return on equity of 12.15% and a net margin of 7.85%.The firm’s revenue for the quarter was up 5.9% compared to the same quarter last year. During the same quarter last year, the firm earned $0.20 earnings per share. Leonardo DRS updated its FY 2026 guidance to 1.260-1.300 EPS.

Here are the key takeaways from Leonardo DRS’s conference call:

• Company reported strong Q1 results with revenue of $846M (+6% YoY), adjusted EBITDA of $105M (+28% YoY), and adjusted EPS of $0.26, with margin expansion of ~210 bps.
• Management raised full-year 2026 guidance to $3.90B–$3.975B revenue, $515M–$530M adjusted EBITDA, and $1.26–$1.30 adjusted EPS
• Demand momentum and funded backlog reached company records (17th consecutive quarter with book-to-bill ?1), driven by tactical radars, infrared sensing and a notable $533M DAIRCM production IDIQ, prompting capacity increases.
• Company is increasing organic investment in R&D and CapEx and launching products like THOR and Sage Core while pursuing targeted tuck-in M&A to fill technology gaps across counter?UAS, space sensing, and naval power systems.
• Q1 had a modest free cash flow outflow due to seasonality and higher working capital to fund growth, though management expects Q2 to be modestly FCF positive and improved conversion over the year.

Leonardo DRS Stock Down 0.8%

DRS traded down $0.35 during trading hours on Thursday, reaching $41.44. 1,141,237 shares of the stock traded hands, compared to its average volume of 1,199,057. Leonardo DRS has a fifty-two week low of $32.43 and a fifty-two week high of $49.31. The company has a market cap of $11.02 billion, a price-to-earnings ratio of 38.73, a PEG ratio of 2.88 and a beta of 0.29. The company has a debt-to-equity ratio of 0.12, a current ratio of 1.89 and a quick ratio of 1.60. The firm’s fifty day simple moving average is $44.63 and its two-hundred day simple moving average is $39.77.

Leonardo DRS Announces Dividend

The company also recently declared a quarterly dividend, which will be paid on Tuesday, June 2nd. Investors of record on Tuesday, May 19th will be issued a dividend of $0.09 per share. This represents a $0.36 dividend on an annualized basis and a yield of 0.9%. The ex-dividend date of this dividend is Tuesday, May 19th. Leonardo DRS’s dividend payout ratio (DPR) is presently 33.64%.

Wall Street Analysts Forecast Growth

A number of analysts have recently issued reports on the company. Canaccord Genuity Group boosted their target price on Leonardo DRS from $52.00 to $54.00 and gave the stock a “buy” rating in a report on Wednesday. Bank of America raised their price target on shares of Leonardo DRS from $50.00 to $55.00 and gave the company a “buy” rating in a report on Wednesday, March 25th. Truist Financial upgraded shares of Leonardo DRS to a “strong-buy” rating in a research note on Friday, May 1st. Weiss Ratings raised shares of Leonardo DRS from a “hold (c+)” rating to a “buy (b-)” rating in a research report on Friday, March 20th. Finally, Wall Street Zen cut shares of Leonardo DRS from a “buy” rating to a “hold” rating in a research report on Saturday, May 2nd. One investment analyst has rated the stock with a Strong Buy rating, four have assigned a Buy rating and three have assigned a Hold rating to the company. Based on data from MarketBeat.com, the company presently has a consensus rating of “Moderate Buy” and a consensus price target of $52.00.

Insider Buying and Selling at Leonardo DRS

In related news, SVP Pamela Morrow sold 12,000 shares of the stock in a transaction dated Tuesday, March 3rd. The stock was sold at an average price of $45.20, for a total value of $542,400.00. Following the completion of the transaction, the senior vice president owned 6,494 shares of the company’s stock, valued at approximately $293,528.80. This represents a 64.89% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is accessible through this link. Also, CFO Michael Dippold sold 16,330 shares of Leonardo DRS stock in a transaction that occurred on Monday, March 16th. The stock was sold at an average price of $45.27, for a total value of $739,259.10. Following the sale, the chief financial officer owned 26,622 shares in the company, valued at $1,205,177.94. This represents a 38.02% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold a total of 64,361 shares of company stock valued at $2,944,837 in the last ninety days. Insiders own 0.25% of the company’s stock.

Institutional Trading of Leonardo DRS

Hedge funds have recently made changes to their positions in the stock. Millennium Management LLC lifted its holdings in Leonardo DRS by 152.1% during the 3rd quarter. Millennium Management LLC now owns 1,776,185 shares of the company’s stock worth $80,639,000 after buying an additional 1,071,708 shares during the last quarter. AQR Capital Management LLC increased its holdings in shares of Leonardo DRS by 528.6% in the 3rd quarter. AQR Capital Management LLC now owns 1,273,444 shares of the company’s stock valued at $56,000,000 after acquiring an additional 1,070,870 shares during the last quarter. UBS Group AG raised its position in shares of Leonardo DRS by 566.2% during the 3rd quarter. UBS Group AG now owns 711,588 shares of the company’s stock valued at $32,306,000 after acquiring an additional 604,783 shares in the last quarter. Bank of America Corp DE lifted its stake in Leonardo DRS by 64.6% during the second quarter. Bank of America Corp DE now owns 1,251,415 shares of the company’s stock worth $58,166,000 after purchasing an additional 491,158 shares during the last quarter. Finally, Deutsche Bank AG boosted its holdings in Leonardo DRS by 203.7% in the fourth quarter. Deutsche Bank AG now owns 530,899 shares of the company’s stock worth $18,098,000 after purchasing an additional 356,067 shares during the period. Institutional investors and hedge funds own 18.76% of the company’s stock.

Leonardo DRS Company Profile

Leonardo DRS is a U.S.-based defense technology company and wholly owned subsidiary of Italy’s Leonardo S.p.A. The firm specializes in developing and integrating mission-critical systems for military and government customers, with a primary focus on command, control, communications, computers, intelligence, surveillance and reconnaissance (C4ISR). Its core offerings encompass advanced sensors, targeting systems, radars and electronic warfare solutions designed to enhance situational awareness and operational effectiveness across land, sea and air domains.

The company’s portfolio includes naval combat management systems, unmanned vehicle sensors, power generation and distribution equipment, and training and simulation solutions.

Further Reading

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