Report
Valens Research

BAH - Embedded Expectations Analysis - 2019 10 09

Booz Allen Hamilton Holding Corporation (BAH:USA) currently trades near corporate averages relative to UAFRS-based (Uniform) Earnings, with a 22.8x Uniform P/E. At these levels, market expectations are for declining profitability, and management may be concerned about demand constraints, their growth pipeline, and guidance.

Specifically, management may be downplaying their demand constraints, and they may be concerned about their growth pipeline. Furthermore, they may lack confidence in their ability to sustain contract performance and to meet their full-year guidance. Finally, they may lack confidence in the efficacy of their M&A strategy, and they may lack confidence in their ability to pivot to more technically focused work.
Underlying
Booz Allen Hamilton Holding Corporation Class A

Booz Allen Hamilton Holding is a holding company. The company provides management and technology consulting, analytics, engineering, digital solutions, mission operations, and cyber knowledge to U.S. and international governments, corporations, and non-profit organizations. The company's services are: Consulting, which focuses on solving client problems and developing mission-oriented solutions; Analytics, which includes decision analytics, automation, and data science solutions; Digital Solutions, which develops, designs, and implements solutions; Engineering, which delivers engineering services and solutions; and Cyber, which focuses on active prevention, detection, and cost effectiveness.

Provider
Valens Research
Valens Research

In 2009, just as the dust was settling from the last major equity and credit market crises, we launched a boutique research firm with the intention of breaking Wall Street’s biases and broken incentives:

  • GAAP and IFRS have failed to provide rules for reliable financial statement reporting
  • Stock analyst recommendations are not grounded in disciplined financial analysis
  • Credit agencies have been set up to grossly fail in their responsibilities to investors and the public markets
  • Utter lack of willingness of major research firms to employ the the most advanced forensic analysis available

We sought to provide investors and company analysts with a source of information that changed all that.
Many years later, our business model remains because little has changed on Wall Street.

  • Corporate credit ratings remain years behind the fundamental underpinnings of company performance
  • Stock analysts continue to make recommendations with deeply inherent biases
  • Research firms have failed to break down the walls between credit, equity, and macroeconomic research
  • The governing accounting bodies have created more leeway for mis-estimates and mis-classifications as financials have become unwieldy and overwhelming

The integrity of Valens Research is founded in our disciplined processes and analytics. No “star” analysts. No corporate advisory relationships. No-nonsense opinions and recommendations.

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Valens Research

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