On Friday, Booz Allen (NYSE:BAH) Hamilton Holding Corporation (NYSE:BAH) saw its stock price target increased by Stifel following the company's announcement of its fourth-quarter adjusted earnings per share (EPS).
The firm's adjusted EPS came in at $1.33, surpassing both the consensus estimate of $1.23 and Stifel's own estimate of $1.20. The increase in the price target is from $170.00 to $175.00, while the Buy rating for the stock remains unchanged.
The company demonstrated robust sales growth, posting a 13.9% increase for the quarter and a 14.5% organic growth for the year. Additionally, Booz Allen's margins have been performing well, with a reported 11.1% in the fourth quarter, excluding a tax assessment adjustment.
The company also released its guidance for fiscal year 2025, projecting adjusted EPS to be between $5.80 and $6.05, sales growth at a 9.5% midpoint, and cash from operations estimated to be between $825 million and $925 million. This translates to free cash flow (FCF) at the midpoint of approximately $775 million, which is in line with Stifel's estimate of $767 million.
Stifel's analysis of Booz Allen's performance includes a discussion of potential bull and bear cases for the company's future. The recent earnings report is seen as supportive of the bull case. The firm suggests that higher growth levels could improve margins and that the company's ability to pay down debt and execute share buybacks could be beneficial. Moreover, the report mentions an adjusted EPS headwind of about 7 cents from interest expense.
In summary, Stifel maintains a positive outlook on Booz Allen, reiterating the Buy rating and increasing the price target to $175, reflecting confidence in the company's financial performance and future prospects.
InvestingPro Insights
Booz Allen Hamilton Holding Corporation (NYSE:BAH) has shown a strong financial performance, and real-time data from InvestingPro further enriches the analysis of the company's potential. With a market capitalization of $20.41 billion and a P/E ratio standing at 50.57, Booz Allen is positioned as a significant player in its industry.
Notably, the company's revenue growth was 13.9% over the last twelve months as of Q1 2023, indicating a robust sales trajectory that aligns with the positive earnings report highlighted by Stifel.
InvestingPro Tips reveal that Booz Allen has raised its dividend for 8 consecutive years and net income is expected to grow this year, reinforcing the company's financial stability and potential for future growth. Moreover, the stock has had a high return over the last year, with a 68.83% increase, which suggests a strong market performance that investors may find appealing.
For readers looking to delve deeper into Booz Allen's financial health and future prospects, there are 16 additional InvestingPro Tips available, offering a comprehensive analysis of the company's performance. To gain access to these insights, readers can use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at InvestingPro.
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