Telos Price Target Lowered by BMO Despite Solid Quarterly Performance

BMO Capital reduced its price target on Telos Corp. (NASDAQ: TLS) to $5 from $8, while maintaining a Market Perform rating, despite the company delivering stronger-than-expected quarterly results.

The firm noted that revenue exceeded expectations, supported by robust growth in the Security Solutions segment, particularly stronger-than-anticipated performance in Telos ID.

Adjusted EBITDA and margins also came in ahead of forecasts, reflecting improved cost discipline and execution.

For fiscal 2026, revenue guidance was broadly in line with expectations, with potential upside from new contract awards, although some uncertainty remains due to government-related timing factors.

While BMO expects gross margin pressure in fiscal 2026 compared with fiscal 2025, it anticipates adjusted EBITDA margins will expand year over year.

Overall, the firm maintained a neutral stance while adjusting its valuation to reflect updated assumptions.