SAIC - Embedded Expectations Analysis - 2020 03 11
ï€ Science Applications International Corporation (SAIC:USA) currently trades at historical highs relative to UAFRS-based (Uniform) Earnings, with a 21.0x Uniform P/E. Even at these levels, markets are still pricing in bearish expectations for the firm, and management appears concerned about contract awards, their Engility acquisition, and growthï€ Specifically, management may lack confidence in their ability to sustain contract award momentum, accelerate net cost synergies with Engility, and continue revenue, EBITDA, and margin performance following their Engility acquisition. Moreover, they may be concerned about lower cost-plus contract volumes and the progress of their acquisition integration. Finally, management may be exaggerating the strength of their pipeline, and they may lack confidence in their ability to continue decreasing their leverage and investing in technologies that fuel long-term growth
Science Applications International provides technical, engineering and enterprise information technology (IT) services. The company provides engineering, systems integration and information technology offerings for government projects and provides a range of services with an emphasis on differentiated technology services. The company's offerings include: engineering; technology and equipment platform integration; maintenance of ground and maritime systems; logistics; training and simulation; operation and program support services; and end-to-end services spanning the design, development, integration, deployment, management and operations, sustainment and security of its customers' entire IT infrastructure.
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