Latest news with #LDOS
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6 days ago
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Leidos Outperforms Market YTD: Is it the Right Time to Buy the Stock?
Leidos Holdings Inc. LDOS shares have rallied an impressive 3.1% in the year-to-date period, outperforming the S&P 500's return of 0.1%. The company, however, underperformed the Zacks Aerospace-Defense industry's growth of 17.5% and the broader Zacks Aerospace sector's appreciation of 18.6%. Image Source: Zacks Investment Research Other industry players, such as RTX Corp. RTX and Northrop Grumman Corp. NOC, also performed impressively, with their shares rising 17.9% and 3.3%, respectively, year to date. With Leidos Holdings riding high, individuals may rush to add the stock to their portfolio. However, before making any hasty decision, it would be prudent to take a look at the reasons behind the gain, the stock's growth prospects, as well as risks (if any) to investing in the same. This will help investors make a more insightful decision. Being a prominent aerospace-defense stock, with a diverse product portfolio ranging from cybersecurity technologies to health data analytics, Leidos Holdings enjoys steady order flows from varied sources. These orders culminate in a solid backlog count, which is indicative of the solid demand that LDOS' products enjoy across diverse industries. Notably, LDOS ended the first quarter of 2025 with a backlog of $46.30 billion, reflecting an improvement over the prior quarter's level of $43.55 billion. Such improved backlog count bolsters the company's future revenue generation prospects and, in turn, must have boosted investors' confidence in this stock's profitability, which was reflected in the form of the share price rise as mentioned above. The company's sturdy financial health is likely to have also compelled investors to stay invested in this stock. Leidos Holdings' cash and cash equivalents totaled $0.84 billion at the end of the first quarter of 2025, while its current debt totaled $0.12 billion. By doing a comparative analysis of these figures, we may safely conclude that the company holds a strong solvency position in the near term. Moreover, its current ratio of 1.54 as of April 4, 2025, being more than one, indicates that the company boasts sufficient capital to pay off its short-term debt obligations. The current macroeconomic and geopolitical environment is enhancing growth prospects for Leidos Holdings, supported by heightened global tensions and the U.S. administration's strong commitment to increased defense spending. In May 2025, a White House report confirmed President Trump's proposal to raise the defense budget by 13% to $1.01 trillion for fiscal 2026. A key feature of this proposal is substantial investment in the "Golden Dome"—a next-generation missile defense shield aimed at protecting the U.S. from adversarial threats. To this end, Leidos Holdings believes that it is well-positioned to play a critical role in the Golden Dome initiative, given its advanced air and missile defense capabilities, including its ongoing contribution to the defense of Guam. With a focus on cutting-edge defense solutions, LDOS is thus well-positioned for sustained long-term growth amid the aforementioned background. The Zacks Consensus Estimate for LDOS' long-term (three-to-five-year) earnings growth is pegged at 7.4%. A sneak peek at its near-term earnings and sales estimates mirrors a similar picture. The Zacks Consensus Estimate for 2025 and 2026 sales suggests an improvement of 2.7% and 3.2%, respectively, year over year. A similar improvement is suggested by the annual estimates for earnings as well. The Zacks Consensus Estimate for LDOS' 2025 and 2026 earnings per share has moved north 1.8% and 1%, respectively, over the past 60 days. The upward revision in earnings estimates indicates analysts' increasing confidence in the stock's earnings growth capabilities. Image Source: Zacks Investment Research Image Source: Zacks Investment Research Despite strong growth prospects, Leidos Holdings faces some challenges that one should consider before investing in the stock. A major concern is the ongoing labor shortage in the aerospace-defense sector. According to the 2024 Aerospace Industries Association (AIA)-PwC Workforce Study, industry attrition remains high at 13%, well above the U.S. average of 3.8%, driven by retirements and turnover. This talent gap may lead to production delays and quality issues, affecting Leidos Holdings' ability to meet delivery timelines. Other industry players like NOC and RTX are facing this labor shortage crisis. Furthermore, the imposition of U.S. tariffs on major trading partners raises input costs and supply chain uncertainties. If such trade restrictions intensify, Leidos Holdings could face increased production expenses and material shortages, ultimately impacting its operational efficiency and profitability. In terms of valuation, LDOS' forward 12-month price-to-earnings (P/E) is 13.49X, a discount to its industry's average of 26.42X. This suggests that investors will be paying a lower price than the company's expected earnings growth compared to that of its industry. Image Source: Zacks Investment Research Its industry peers are also trading at a discount to the industry average. RTX is trading at a forward 12-month P/E of 21.71X, while Northrop is trading at 18.11X. To conclude, investors interested in LDOS may add this stock to their portfolio, considering its discounted valuation, long-term growth prospects, as well as upward revision in its earnings estimates. LDOS currently has a VGM Score of A, which is also a favorable indicator of strong performance. The company's Zacks Rank #2 (Buy) further supports our thesis. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Northrop Grumman Corporation (NOC) : Free Stock Analysis Report Leidos Holdings, Inc. (LDOS) : Free Stock Analysis Report RTX Corporation (RTX) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
30-05-2025
- Business
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Leidos Buys Kudu Dynamics for $300M, Expands Cyber Capabilities
Leidos Holdings, Inc. LDOS stated that it acquired Kudu Dynamics for roughly $300 million in cash. The acquisition should strengthen LDOS's focus on artificial intelligence (AI)-powered offensive cyber operations, electromagnetic spectrum capabilities and vulnerability research. Kudu Dynamics' improved offensive cyber capabilities should help Leidos expand its customer base and product offerings, and improve its AI-enabled cyber capabilities for defense, intelligence and homeland security acquisition of Kudu Dynamics aligns seamlessly with Leidos' strategy to expand its differentiated offensive cyber technology capabilities through AI-driven innovation. As cyber warfare evolves, the integration of Kudu Dynamics' cutting-edge solutions with Leidos' scale and mission-driven approach reinforces its commitment to delivering smarter, full-spectrum cyber tools, boosting LDOS' position as a prominent contractor in the defense tech escalating global cybersecurity threats that increasingly endanger national security, demand for advanced cyber defense solutions is surging. Leidos' acquisition of Kudu Dynamics positions it to capitalize on this trend, potentially boosting its sales by delivering advanced, AI-powered offensive cyber capabilities to meet rising defense and intelligence needs. The defense industry has seen a notable rise in mergers and acquisitions recently due to many factors, like a growing emphasis on cost-reduction initiatives and diversifying their portfolio to tackle intensifying competition. These transactions are becoming more significant, allowing businesses to grow as they see fit by expanding their operations, gaining access to new skills, developing technologies and ultimately producing higher-quality goods and services to capture more market latest decision to acquire Kudu Dynamics seems to have been motivated by some of the aforementioned factors. Other defense companies that recently indulged in acquisition deals are as May 2025, TransDigm Group, Inc. TDG announced signed a definitive merger agreement to buy Servotronics, Inc., for nearly $110 million. This merger aligns with TDG's long-term strategy of acquiring highly developed components with strong aftermarket has a long-term (three to five years) earnings growth rate of 13.4%. The Zacks Consensus Estimate for its fiscal 2025 sales implies a year-over-year improvement of 11.7%.In February 2025, HEICO Corporation HEI declared that its Flight Support Group acquired 90% of Millennium International, a leader in providing business and regional jet avionics repair has a long-term earnings growth rate of 17%. The Zacks Consensus Estimate for its fiscal 2025 sales indicates a year-over-year rise of 11.4%.In February 2025, Teledyne Technologies, Inc. TDY completed the acquisition of some selected aerospace and defense electronics businesses from Excelitas Technologies Corp. for nearly $710 has a long-term earnings growth rate of 9.9%. The Zacks Consensus Estimate for its 2025 sales suggests year-over-year growth of 6.2%. In the past three months, shares of Leidos have gained 14.7% compared with the industry's growth of 10.9%. Image Source: Zacks Investment Research LDOS currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Transdigm Group Incorporated (TDG) : Free Stock Analysis Report Teledyne Technologies Incorporated (TDY) : Free Stock Analysis Report Heico Corporation (HEI) : Free Stock Analysis Report Leidos Holdings, Inc. (LDOS) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Sign in to access your portfolio
Yahoo
27-05-2025
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2 Reasons to Avoid LDOS and 1 Stock to Buy Instead
Leidos trades at $152.40 per share and has stayed right on track with the overall market, losing 7.1% over the last six months while the S&P 500 is down 3.3%. This might have investors contemplating their next move. Is there a buying opportunity in Leidos, or does it present a risk to your portfolio? See what our analysts have to say in our full research report, it's free. Even with the cheaper entry price, we're swiping left on Leidos for now. Here are two reasons why we avoid LDOS and a stock we'd rather own. Forecasted revenues by Wall Street analysts signal a company's potential. Predictions may not always be accurate, but accelerating growth typically boosts valuation multiples and stock prices while slowing growth does the opposite. Over the next 12 months, sell-side analysts expect Leidos's revenue to rise by 2.5%, a deceleration versus its 7.7% annualized growth for the past two years. This projection doesn't excite us and implies its products and services will face some demand challenges. If you've followed StockStory for a while, you know we emphasize free cash flow. Why, you ask? We believe that in the end, cash is king, and you can't use accounting profits to pay the bills. As you can see below, Leidos's margin was unchanged over the last five years, showing it couldn't improve. Its free cash flow margin for the trailing 12 months was 7.3%. Leidos isn't a terrible business, but it isn't one of our picks. After the recent drawdown, the stock trades at 13.9× forward P/E (or $152.40 per share). This valuation is reasonable, but the company's shakier fundamentals present too much downside risk. We're pretty confident there are more exciting stocks to buy at the moment. We'd suggest looking at a top digital advertising platform riding the creator economy. Donald Trump's victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs. While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
13-05-2025
- Business
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Here's How Much a $1000 Investment in Leidos Made 10 Years Ago Would Be Worth Today
For most investors, how much a stock's price changes over time is important. Not only can it impact your investment portfolio, but it can also help you compare investment results across sectors and industries. Another thing that can drive investing is the fear of missing out, or FOMO. This particularly applies to tech giants and popular consumer-facing stocks. What if you'd invested in Leidos (LDOS) ten years ago? It may not have been easy to hold on to LDOS for all that time, but if you did, how much would your investment be worth today? With that in mind, let's take a look at Leidos' main business drivers. Founded in 1969, Delaware-based Leidos Holdings, Inc. is a global science and technology leader that serves the defense, intelligence, civil and health markets. Its core capabilities include providing solutions in the fields of cybersecurity; data analytics; enterprise IT modernization; operations and logistics; sensors, collection and phenomenology; software development; and systems engineering. During the first quarter of 2024, Leidos Holdings completed a realignment of its segment and reporting structure. Consequently, the company currently operates through the following four business segments: National Security and Digital: This business segment offers technology-enabled services and mission software capabilities in the areas of cyber, logistics, security operations and decision analytics, as well as IT operations and digital transformation programs. In 2024, this division generated revenues of $7,365 million, contributing 44.2% to Leidos' total & Civil: This segment provides services and solutions in the areas of public health, care coordination, life and environmental sciences and transportation. Its core capabilities include health information management services, managed health services, systems and infrastructure modernization, and life sciences research and development. The unit recorded revenues of $5,015 million in 2024, which accounted for 30.1% of Leidos' total revenues. Commercial & International: This unit's products include IT modernization, software solutions, mission support and logistics, Command, Control, Computers, Communications, Intelligence, Surveillance and Reconnaissance (C4ISR) technologies and services, cloud services, power grid engineering, energy modernization and security products and services. Revenues from this division totaled $2,252 million, representing 13.5% of Leidos' total revenues. Defense Systems: This unit develops and produces advanced space, aerial, surface, and sub-surface manned and unmanned defense systems. Revenues from this division totaled $2,030 million in 2024, representing 12.2% of Leidos' total revenues. Anyone can invest, but building a successful investment portfolio takes a combination of a few things: research, patience, and a little bit of risk. So, if you had invested in Leidos a decade ago, you're probably feeling pretty good about your investment today. A $1000 investment made in May 2015 would be worth $3,645.52, or a 264.55% gain, as of May 12, 2025, according to our calculations. Investors should note that this return excludes dividends but includes price increases. The S&P 500 rose 167.47% and the price of gold increased 167.98% over the same time frame in comparison. Analysts are forecasting more upside for LDOS too. Leidos Holdings ended the first quarter of 2025 on a solid note, with both its earnings and revenues having surpassed their respective Zacks Consensus Estimates. The company's defense solutions continue to witness increased contract wins from the Pentagon and other U.S. allies. These contract wins enhanced the company's bookings, which, in turn, led to a solid backlog of $46.30 billion at the end of first quarter of 2025. The company's shares have outperformed its industry in the past year. However, the shortage of skilled labor in the aerospace and defense industry poses a threat to Leidos. Persistent supply-chain constraints might continue to affect Leidos. The U.S. government has imposed enhanced export controls on certain products and sanctions on certain industry sectors in Russia, which in turn may impact the company. Over the past four weeks, shares have rallied 9.74%, and there have been 4 higher earnings estimate revisions in the past two months for fiscal 2025 compared to none lower. The consensus estimate has moved up as well. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Leidos Holdings, Inc. (LDOS) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
13-05-2025
- Business
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LDOS vs. HWM: Which Stock Is the Better Value Option?
Investors with an interest in Aerospace - Defense stocks have likely encountered both Leidos (LDOS) and Howmet (HWM). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look. We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits. Currently, both Leidos and Howmet are holding a Zacks Rank of # 2 (Buy). Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. However, value investors will care about much more than just this. Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels. Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use. LDOS currently has a forward P/E ratio of 14.64, while HWM has a forward P/E of 46.16. We also note that LDOS has a PEG ratio of 1.98. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. HWM currently has a PEG ratio of 2.43. Another notable valuation metric for LDOS is its P/B ratio of 4.66. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, HWM has a P/B of 13.44. Based on these metrics and many more, LDOS holds a Value grade of A, while HWM has a Value grade of D. Both LDOS and HWM are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that LDOS is the superior value option right now. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Leidos Holdings, Inc. (LDOS) : Free Stock Analysis Report Howmet Aerospace Inc. (HWM) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
