Karman Holdings Inc. (KRMN) Stock Analysis
Karman Holdings Inc. (KRMN) Stock Analysis
Analysis from 10-Q filed 2025-11-07. Data as of Q4 2025.
Overall Grade: F (Concerning)
Karman Holdings Inc. faces challenges in financial performance that warrant careful analysis.
| Metric | Value | Context |
|---|---|---|
| ROIC | 5.1% | Below expectations |
| FCF Margin | -9.0% | Cash flow pressure |
| Debt/Equity | 1.3x | Moderate leverage |
Investment Thesis: Financial metrics indicate concerning business quality with areas requiring attention.
Explore Karman Holdings Inc.: Earnings History | Filing Intelligence | ROIC Analysis
Profitability: Karman Holdings Inc. earns 5.1% ROIC, Bottom 50% in Industrials
Karman Holdings Inc.'s trailing-twelve-month ROIC of 5.1% ranks Bottom 50% in Industrials companies (sector median: 7.4%), driven by NOPAT margin of 8.3% combined with asset turnover of 0.5x. Source: 10-Q filed 2025-11-07. Gross margin of 40.3% with operating margin at 15.5% reflects strong pricing power.
| Metric | KRMN | Rating | Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 5.1% | Warning | Below sector median of 7.4% |
| Return on Equity (ROE) | 5.1% | Warning | Moderate equity returns |
| Gross Margin | 40.3% | Good | Strong pricing power |
| Operating Margin | 15.5% | Good | Efficient operations |
Cash Flow: Karman Holdings Inc. generates $-42.5M FCF at -9.0% margin, positive NaN/8 quarters
Karman Holdings Inc. generated $-42.5M in free cash flow (TTM), a -9.0% FCF margin. FCF was positive in N/A of the last 8 quarters. Source: 10-Q filed 2025-11-07.
| Metric | KRMN | Rating | Context |
|---|---|---|---|
| Free Cash Flow Margin | -9.0% | Red flag | Thin cash margins |
| Free Cash Flow (TTM) | $-42.5M | Red flag | Cash burn |
| OCF/Net Income | -1.3x | Warning | Potential accrual concerns |
| FCF Consistency (8Q) | N/A | Warning | Variable cash flow |
Balance Sheet: Karman Holdings Inc. at 1.3x leverage
Karman Holdings Inc.'s debt-to-equity ratio of 1.3x reflects elevated leverage. Total debt of $499.1M offset by $34.0M in cash. Source: 10-Q filed 2025-11-07.
| Metric | KRMN | Rating | Context |
|---|---|---|---|
| Debt to Equity | 1.3x | Adequate | Moderate leverage |
| Net Cash Position | $-465.2M | Adequate | Net debt position |
Valuation: Karman Holdings Inc. trades at 562.8x earnings
Karman Holdings Inc. trades at a P/E of 562.8x. Free cash flow yield of -0.4% reflects market expectations for growth.
| Metric | KRMN | Rating | Context |
|---|---|---|---|
| P/E Ratio | 562.8x | Warning | Premium valuation |
| EV/Sales | 21.2x | Warning | Growth premium priced in |
| FCF Yield | -0.4% | Warning | Lower cash yield |
Capital Allocation: Karman Holdings Inc. returns 0.0% shareholder yield
Karman Holdings Inc.'s total shareholder yield is 0.0% (dividends + buybacks). Source: 10-Q filed 2025-11-07.
| Metric | KRMN | Rating | Context |
|---|---|---|---|
| Total Shareholder Yield | 0.0% | Warning | Dividend + buyback yield combined |
| Total Capital Returned (TTM) | $0 | Adequate | Dividends + buybacks returned to shareholders |
Sector Rankings
| Metric | Value | Percentile | vs Median |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 5.1% | Bottom 50% | 0.7x below |
| Free Cash Flow Margin | -9.0% | Bottom 10% | -1.9x below |
| Gross Margin | 40.3% | Top 50% | 1.2x above |
| Operating Margin | 15.5% | Top 25% | 2.0x above |
| Return on Equity (ROE) | 5.1% | Bottom 50% | 0.6x below |
| P/E Ratio | 562.8x | N/A | - |
Financial Scorecard
| Metric | KRMN | Rating | Sector Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 5.1% | Warning | Bottom 50% of sector (median: 7.4%) |
| Free Cash Flow Margin | -9.0% | Red flag | Thin cash margins |
| Gross Margin | 40.3% | Good | Top 50% of sector (median: 33.1%) |
| Debt to Equity Ratio | 130.4% | Adequate | Elevated but manageable |
| P/E Ratio (Price-to-Earnings) | 562.8x | Warning | High expectations priced in |
| Free Cash Flow Yield | -0.4% | Red flag | Growth-focused valuation |
Frequently Asked Questions
Q: What is Karman Holdings Inc.'s Return on Invested Capital (ROIC)?
Karman Holdings Inc. (KRMN) has a trailing twelve-month Return on Invested Capital (ROIC) of 5.1%. This compares below the sector median of 7.4%. An ROIC below 8% suggests the company may be destroying shareholder value.
Q: What is Karman Holdings Inc.'s Free Cash Flow Margin?
Karman Holdings Inc. (KRMN) has a free cash flow margin of -9.0%, generating $-42.5 million in free cash flow over the trailing twelve months. Negative free cash flow means the company is consuming cash, which may require financing.
Q: Is Karman Holdings Inc. stock overvalued or undervalued?
Karman Holdings Inc. (KRMN) trades at a P/E ratio of 562.8x, which is above the sector median of N/A. The EV/Sales multiple is 21.2x.
Q: How much debt does Karman Holdings Inc. have?
Karman Holdings Inc. (KRMN) has a debt-to-equity ratio of 1.3x with total debt of $499.1 million. Net debt position is $465.2 million.
Q: What is Karman Holdings Inc.'s revenue and earnings growth?
Karman Holdings Inc. (KRMN) grew revenue by 36.6% year-over-year. Earnings per share increased by 62.5% compared to the prior year. Double-digit revenue growth indicates strong demand and market share gains.
Q: How does Karman Holdings Inc. compare to competitors in Industrials?
Compared to other companies in Industrials, Karman Holdings Inc. (KRMN) shows: ROIC of 5.1% is below the sector median of 7.4% (Bottom 41%). FCF margin of -9.0% trails the sector median of 4.8%. Gross margin at 40.3% is 7.2 percentage points higher than sector peers. These rankings are based on MetricDuck's analysis of all Industrials companies with available SEC filings.
Q: What warning signs should I watch for with Karman Holdings Inc.?
Investors in Karman Holdings Inc. (KRMN) should monitor these potential warning signs: 1) FCF margin is thin at -9.0%, leaving limited buffer for economic downturns. 2) ROIC has been declining, potentially signaling deteriorating competitive position. Regular monitoring of SEC filings and quarterly trends is recommended.
Data Source: Data sourced from 10-Q filed 2025-11-07. TTM metrics as of Q4 2025.
Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.
Scope: This analysis covers SEC filing fundamentals — profitability, cash flow, balance sheet, and valuation metrics. For analyst estimates and price targets, consult sell-side research.
This analysis is for informational purposes only and does not constitute investment advice.