Why Booz Allen Hamilton Stock Popped Friday

• Booz Allen bushed connected net but missed connected income this morning.

• Booz guided little connected income and escaped currency travel for the remainder of the year.

• 10 stocks we similar amended than Booz Allen Hamilton ›

Booz Allen Hamilton (NYSE: BAH), the defence contractor nary 1 had ever heard of earlier its worker Edward Snowden leaked authorities secrets backmost successful 2013, reported a almighty net bushed this morning, sending its shares soaring 9.2% done 11:30 a.m. ET.

Analysts forecast Booz would gain $1.27 per share, adjusted for one-time items, connected income of $2.7 cardinal successful fiscal Q3 2026. Booz missed the income forecast, reporting gross of lone $2.6 billion, but crushed connected earnings, reporting $1.77 per share.

Booz Allen's Q3 2026 income declined 10% -- 4 of which Booz attributed to income delayed by past year's authorities shutdown. That's not worrisome arsenic those revenues were presumably lone postponed by the shutdown, not lost.

More concerning is that Booz's book-to-bill ratio for the 4th was an anemic 0.3. That suggests near-term gross maturation volition beryllium anemic -- and income mightiness adjacent support falling. (Trailing-12-month book-to-bill, connected the different hand, is simply a respectable 1.1 ratio, suggesting Q3's anemic results were much of a blip than a trend.)

Profits quality was much intelligibly good. Margins are up, and net grew 7% successful Q3. Even better, escaped currency travel eclipsed reported nett profit, coming successful astatine $248 cardinal -- up 85%.

On guidance, Booz lowered its gross and escaped currency travel forecasts. Still, absorption anticipates generating FCF betwixt $825 cardinal and $900 cardinal by year-end. At the precocious end, that values Booz banal astatine astir 14 times escaped currency flow; astatine the debased end, conscionable a spot much than 15x.

It's a decent price, not a large price, for a dependable authorities contracting concern with a 2.3% dividend yield. Good capable for a "hold" rating, I think, if possibly not a "buy."

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