Karman's (KRMN) active pipeline has tripled to about $3 billion since Q1 2025 as the demand environment has continued to strengthen, and the recent pullback in the stock presents an attractive entry point, RBC Capital Markets said Monday in a note.

Karman announced a secondary offering of 14 million shares priced at $61 per share last week. Private equity firm Trive already formally distributed its shares to limited partners and general partners, the brokerage said.

RBC expects increased contract activity in the second half of 2026 and into 2027. The timeline of these opportunities ranges from 4 to 7 years, and the brokerage sees visibility on revenue growth as the most important factor for sentiment on the stock, according to the note.

The fiscal 2027 budget uncertainty has de-rated the broader defense-tech sector, but the fundamentals for Karman remain strong. The brokerage said investors are mainly focused on second-half 2026 bookings acceleration and organic growth upside.

RBC kept an outperform rating on Karman with a price target of $100.

Price: 53.87, Change: +0.22, Percent Change: +0.41