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AI Stock Memo: DRS - Leonardo DRS - RankAlpha

DRS

Rating buyAI Memo

Leonardo DRS

As of 2026-01-10/Confidence medium

Open ticker Back to Memos

Data freshness

AI Memo

As of 2026-01-10 • Model: RankAlpha Sentiment AI

Decision Panel

Action, confidence, horizon, and decision blockers at a glance.

Action

buy

Confidence

medium

Horizon

—

Key catalyst

Quarterly earnings release and guidance update • 2026-04-10

Base target: $47 / p=55% prob

Biggest risk

Bear case: contract timing delays, cost overruns or DoD funding shifts compress revenue visibility and margins, prompting downward analyst revisions and share-price pressure.

Invalidation

Break below $36 or thesis failure.

What would change my mind?

Bull case: sustained DoD awards, clear backlog conversion and margin expansion under management drive EPS growth and a multiple re-rating above consensus.

Research note

Recommendation

buy

Confidence

medium

As of

2026-01-10

Base target

$47

p=55%

Bull target

$55

p=25%

Bear target

$36

p=20%

Key bullets

Fast scan of bull, bear, and watch items

BullKey bullets

Competitive DoD contract awards / backlog revisions
Production scaling on key sensor/avionics programs
Bull case: sustained DoD awards, clear backlog conversion and margin expansion under management drive EPS growth and a multiple re-rating above consensus.

BearKey bullets

Contract award timing and scope
Defense budget re-prioritization or prime-level cuts
Supply-chain and production cost inflation

WatchKey bullets

Quarterly earnings release and guidance update

Summary

High-level snapshot

Recommendation

buy

Model confidence

medium

Timeframe

Asset

Equity

Trigger

Base case: $47 (p=55%)

Target spread vs base: +17% / -23%

Scenario probabilities

Bull Target: $55 (p=25%)Base Target: $47 (p=55%)Bear Target: $36 (p=20%)

Commentary

Sentiment is cautiously constructive: analyst 12-month targets sit modestly above the anchor, implying measured upside tied to contract flow. Near-term focus is earnings/guidance and any contract announcements; execution risk keeps downside plausible.

As of 2026-01-10 • Updated bi-weekly / post-earningsSource: Internal modelMethodology

Analyst Summary

Thesis highlights from the latest analysis

Bull Case

Bull case: sustained DoD awards, clear backlog conversion and margin expansion under management drive EPS growth and a multiple re-rating above consensus.

Bear Case

Bear case: contract timing delays, cost overruns or DoD funding shifts compress revenue visibility and margins, prompting downward analyst revisions and share-price pressure.

Drivers

Scannable catalysts and supporting factors

Competitive DoD contract awards / backlog revisions
Production scaling on key sensor/avionics programs

Human Analyst Targets

External snippets for comparison only; verify at source.

Unverified externalLast fetched 2026-01-10Source quality: external scrape

External snippets are unverified; treat as directional signals only. Always confirm with the original provider.

Inline RA est

Provider

serper

Median (USD)

$46.90

Range (USD)

$25.81 - $53.55

Count

Query: Leonardo DRS Inc Common (DRS) analyst consensus price target high low average

DRS Stock Forecast - Leonardo DRS Inc - Alpha Spread
Search result #1
According to Wall Street analysts, the average 1-year price target for DRS is 47.84 USD with a low forecast of 40.4 USD and a high forecast of 53.55 USD.
Extracted: $47.84, $40.40, $53.55Open source
Leonardo DRS, Inc.: Target Price Consensus and Analysts ...
Search result #2
Analysts' Consensus ; Mean consensus. BUY ; Number of Analysts. 10 ; Last Close Price. 37.46USD ; Average target price. 46.90USD ; Spread / Average Target. +25.20%.
Extracted: $37.46, $46.90Open source
LEONARDO DRS INC (DRS) Stock Analyst Ratings - Chartmill
Search result #3
Analysts have set a mean price target forecast of 47.84. This target is 27.7% above the current price. DRS was analyzed by 14 analysts.
Open source
What is the current Price Target and Forecast for Leonardo DRS, Inc ...
Search result #4
The forecasts for Leonardo DRS, Inc. (DRS) range from a low of $40 to a high of $50. The average price target represents a increase of $25.81 from the last ...
Extracted: $40.00, $50.00, $25.81Open source
LEONARDO DRS, INC. (DRS) Stock, Price, News, Quotes ... - MSN
Search result #5
DRS is rated "Strong Buy" with a 12-month target price of $46.90, a ‎25.20% upside from the current price of $37.46. See more. Strong SellSellHoldBuyStrong ...
Extracted: $46.90, $37.46Open source
Leonardo DRS Inc. Analyst Estimates - MarketWatch
Search result #6
Stock Price Targets. High, $51.00. Median, $48.50. Low, $40.00. Average, $46.90. Current Price, $37.20. Yearly Numbers. Estimates. DRS will report 2025 earnings ...
Extracted: $51.00, $48.50, $40.00, $46.90, $37.20Open source

Scenarios

Bull Target (Scenario probability)

$55 / p=25% prob

Base Target (Scenario probability)

$47 / p=55% prob

Bear Target (Scenario probability)

$36 / p=20% prob

Analysis 2026-01-10 · RankAlpha Sentiment AI

Analysis reference price unavailable. Targets are shown without scenario returns.

Sentiment & Exposure

Sentiment unavailable: insufficient coverage

Events

Other notable items detected

EVENT2026-04-10
Quarterly earnings release and guidance update
Upcoming quarterly report will reset revenue, margin and guidance; the stock typically re-rates on surprises. Assumes standard quarterly timing and analyst follow-ups [#SERP-6][#SERP-2].
Prob 95.00% • Move 8.00% • Priced-in 60.00%

Short-term Catalysts

Next few weeks

Competitive DoD contract awards / backlog revisions
2026-04-10
Award announcements or material backlog changes can trigger discrete moves; the stock is sensitive to contract timing and scope [#SERP-1][#SERP-7].
Prob 40% • Move 15% • Priced-in 30%

Long-term Catalysts

Months to a year

Production scaling on key sensor/avionics programs
2027-01-10
Successful scale-up and margin gains from program maturation could support a multi-quarter re-rate; this depends on execution and supply-chain stability.
Prob 55% • Move 20% • Priced-in 35%

Risks

Contract award timing and scope
Defense budget re-prioritization or prime-level cuts
Supply-chain and production cost inflation

Peers

Symbol	Summary
LHX	L3Harris — overlapping avionics/sensors product set and recurring DoD awards; useful operational comparator.
NOC	Northrop Grumman — systems integrator exposure; shows sensitivity to defense budget and program timing.
LMT	Lockheed Martin — prime-contractor cycles and procurement dynamics set a benchmark for supplier re-rating.

Sources

Internal and external references used in this analysis

Model source: RankAlpha Sentiment AI
Human targets: serper
Targets query: Leonardo DRS Inc Common (DRS) analyst consensus price target high low average
Analysis date: 2026-01-10