LDOS - Embedded Expectations Analysis - 2021 06 30
Leidos Holdings, Inc. (LDOS:USA) currently trades below corporate averages relative to UAFRS-based (Uniform) earnings, with a 16.9x Uniform P/E. At these levels, the market has bearish expectations for the firm, and management may have concerns about their government contracts, growth momentum, and operating efficiencySpecifically, management may lack confidence in their ability to provide multi-energy portal systems for the U.S. Customs and Border Protection prime contract, continue winning contracts for VACIS, and sustain their growth momentum. In addition, they may be overstating their outperformance with fixed price contracts and the capability of RPAs to drive more contract efficiency. Furthermore, they may be concerned about expected increases in R&D spending, and they may lack confidence in their ability to maintain their operating cash flow position and generate more efficient proposals for their Health business. Finally, they may have concerns about overstaffing clinics to work off backlog, multiyear defense spending projections, and the pace of recovery in the SD&A business
Leidos Holdings is a holding company. Through its subsidiaries, the company is engaged in a science, engineering and information technology that provides services and solutions in the defense, intelligence, civil and health markets. The company's defense solutions segment deploys solutions in the areas of intelligence surveillance and reconnaissance, enterprise information technology, integrated systems, cybersecurity and global services. The company's civil segment integrates and protects physical, digital and data domains. The company's health segment delivers solutions to federal and commercial customers that are responsible for the health and well-being of people including service members and veterans.
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.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.