Leidos Holdings Faces Market Struggles Amid Mixed Results

Leidos Holdings, Inc. has seen a significant decline in its stock price as it faces challenges despite beating Q4 forecasts. Analysts remain moderately optimistic, rating it a 'Moderate Buy'.

Date: 26-03-2025

AI Rating: 5

Market Overview
Leidos Holdings, Inc. (LDOS) currently holds a market cap of $17.4 billion and is classified as a large-cap stock. Despite being an industry leader in governmental and commercial service sectors, LDOS has seen a substantial decline in its stock value—down 32.9% from its 52-week high of $202.90 and over 6.7% in the last three months, which is comparatively better than the broader Nasdaq Composite's 9.2% dip.

Earnings Performance
In its latest quarter, Leidos reported adjusted earnings of $2.37 per share, which topped market expectations. However, this positive result was overshadowed by lower-than-expected profit margins in the defense and intelligence sectors, causing shares to fall by 3.6% on the news release date. This reaction indicates a mixed sentiment regarding earnings despite a seemingly favorable outcome.

Future Outlook
Leidos projects its full-year fiscal 2025 adjusted earnings to land between $10.35 and $10.75 per share, with anticipated revenue estimated to be between $16.9 billion and $17.3 billion. This forward guidance suggests that the company is focusing on growth despite its recent struggles.

Comparative Performance
When compared to its competitor Broadridge Financial Solutions, Inc. (BR), which has gained 15.9% over the last year, LDOS's performance has been less impressive. This comparison may cause investors to reevaluate their positions, given the discrepancy in growth rates.

Analyst Sentiment
Despite the current underperformance of the stock, analysts maintain a consensus rating of 'Moderate Buy' among the 15 experts covering LDOS. It's noteworthy that the current stock price is beneath the mean price target of $173.33, indicating some potential for upside from its existing levels.

Stocks: LDOS BR