Karman Holdings (KRMN) is one of the newest public companies in the rapidly expanding aerospace and defense industry. In February 2025, the company completed its initial public offering (IPO) and quickly began displaying record revenues, accelerating margins, and a string of program wins, which put the stock on investors’ radars.

Since it began trading in February, Karman stock has soared 140% from its $22 IPO price, significantly outperforming the S&P 500 Index ($SPX). 

Karman designs, tests, manufactures, and sells highly engineered subsystems for a variety of defense and space programs. Karman’s portfolio includes three distinct yet complementary end markets: hypersonics and strategic missile defense, space and launch, and tactical missiles and integrated defense systems (IDS).

Strong Momentum Since IPO

Karman has gained significant momentum since its IPO. The company is capitalizing on the growing demand for advanced missile defense, hypersonic and tactical systems, and space launch infrastructure. CEO Anthony Koblinski stated in the earnings call that in just two quarters as a public entity, Karman has set back-to-back records and secured its independence via a secondary offering. Furthermore, it has strengthened its strategic position through acquisitions and index inclusions.

In the second quarter, revenue of $115.1 million increased by 35% year over year. Adjusted EBITDA rose 29% to $35.3 million. Adjusted earnings of $0.10 per diluted share more than tripled over the previous year. Funded backlog stood at $719 million. 

In the quarter, Hypersonics and Strategic Missile Defense revenue grew 22% to $35 million, boosted by programs such as the next-generation interceptor and classified contracts. Space & Launch increased 39% to $39.6 million, riding a wave of increased launch activity across both commercial and government programs. Meanwhile, Tactical Missiles & IDS increased 46% to $40.5 million, driven by production ramps in unmanned aerial systems (UAS) and counter-UAS programs. This balanced growth across all three segments shows that Karman is not overly reliant on any one segment, positioning the company for long-term, diversified growth. 

Beyond top-line growth, investors should consider other factors. The company improved its gross margin to 41% through manufacturing efficiencies. Karman’s second-quarter results indicate that the company is transitioning from early stage contract wins and limited production runs to a steady stream of repeatable revenue. Karman also raised its full-year fiscal 2025 guidance. Revenue could increase by 32% year on year to range between $452 million and $458 million. Adjusted EBITDA could increase by 32%. These two factors indicate that the company is entering a higher-volume phase, and that early revenue growth may eventually translate into sustained profitability in the defense supply chain.

On the balance sheet, the company had $27.4 million in cash and equivalents at the end of the quarter. Management also noted that President Donald Trump’s One Big Beautiful Bill Act, signed in July, provides billions of dollars in of funding in alignment with Karman’s business. 

Looking ahead, the company is already building a backlog for 2026 and expects long-term growth to be driven by sustained organic growth from hypersonics, missile defense, and space launches, as well as accretive acquisitions to expand capabilities and deepen relationships with prime contractors. 

What Is the Street Saying About Karman Stock?

Overall, Wall Street is bullish about this newly public space stock, rating it a “Strong Buy.” Of the six analysts covering the stock, four rate it a “Strong Buy,” one rates it a “Moderate Buy,” and one rates it a “Hold.” Given its exceptional rally this year, the stock has surpassed its average target price of $53.25. However, the Street-high estimate of $60 suggests the stock has upside potential of 8.9% over the next 12 months.

The Bottom Line: KRMN Stock Is a Rising Force in Space and Defense

Karman is a compelling entry in the public aerospace and defense industry. It possesses real engineering capability, clear market demand, and early signs of revenue and margin momentum. Risk-averse investors can watch over the next few quarters to determine if the company can transform from an early stage company to a sustained high-growth company.