Kratos recently received a $5.6 million contract award from a U.S. Government Agency for High Performance Unmanned Aerial Target Drone Systems. For those of you that don’t know, Kratos is a leading provider of high performance jet powered unmanned aerial drone systems, vehicles and aircraft for tactical and weapon systems exercise.

Under the contract, the Unmanned Aerial Drone Systems will be produced in a secure Kratos manufacturing facility.

This is great news for the company. Government contacts are always a good sign when looking for growth in a company.

For the fourth quarter that ended  December 25, 2016, approximately 57% of Kratos’ revenue was derived from U.S. Federal Government related customers, approximately 29% from commercial, state and local government customers, and approximately 14% from international customers.

I recently bought shares in Kratos and expect the company to deliver during this contract and quarter. If the company delivers it will position itself to acquire more government contracts in the future.

Kratos has been down the past couple weeks and looks like an attractive buying opportunity at this price.