5 Best Upside Stocks to Buy According to Analysts

2. Kratos Defense & Security Solutions Inc. (NASDAQ:KTOS)

Average Upside Potential: 75.05%

Kratos Defense & Security Solutions Inc. (NASDAQ:KTOS) is one of the best upside stocks to buy according to analysts. On April 21, Kratos Defense & Security Solutions completed the initial flight series of the Mk1 Firejet, a new configuration of its Firejet unmanned aerial system/UAS integrated with the Kratos J85 engine. This high-performance version was developed in collaboration with the US Army Target Systems Management Office/TSMO to provide enhanced aero-performance while remaining in an affordable sub-$500,000 price class.

The J85-powered Firejet offers significant improvements in speed, range, and climb rate, serving as a versatile platform for both aerial target missions and tactical drone operations. The expansion of the Firejet line coincides with the ramp-up of the Kratos Spartan engine production facility, which was established in late 2025. This facility is expected to produce thousands of engines this year, reaching tens of thousands over the next few years to address the depletion of US and ally inventories.

By using an American-made engine with domestically sourced components, Kratos Defense & Security Solutions Inc. (NASDAQ:KTOS) aims to mitigate supply chain risks while meeting the Department of War’s demand for affordable, military-grade capabilities that can be deployed today. This new configuration positions the Firejet as the first-to-market tactical jet UAS of its class, offering fighter-like performance for training and weapons testing.

Kratos Defense & Security Solutions Inc. (NASDAQ:KTOS) is a technology company focused on the development of advanced products and systems for defense, national security, and commercial markets.