Update shared on 02 Dec 2025
Leidos Holdings saw its average analyst price target rise from $210 to $230 as analysts highlighted robust Health & Civil margins, a strong contract pipeline, and increased profitability guidance following recent earnings results.
Analyst Commentary
Recent analyst reports have highlighted several factors influencing sentiment around Leidos Holdings following the latest earnings results and guidance updates.
Bullish Takeaways- Bullish analysts raised their price targets, reflecting confidence in sustained earnings growth and margin strength, particularly in Health & Civil segments.
- The company’s strong contract pipeline, with a book-to-bill ratio of 1.3x and a $69 billion near-term opportunity set, signals significant revenue visibility and future order flow.
- Diversification across defense, veteran health, border security, and autonomous systems is seen as positioning Leidos favorably for premium valuation compared to peers in the government services sector.
- Execution on key funding opportunities, such as the One Big Beautiful Bill Act, and elevated profitability guidance underpin optimism about future growth and market positioning.
- Some analysts remain cautious regarding the conservative 2025 guidance raise, noting the impact of ongoing government shutdown risks on future outlook and execution.
- Continued strength in stock performance raises questions about potential upside limitations given current valuation levels.
- Lingering risks, such as possible delays in government funding or macroeconomic uncertainties, could challenge the company’s ability to fully capture anticipated pipeline opportunities.
What's in the News
- Leidos and Quadridox have partnered to develop an advanced checked baggage screening technology that integrates CT and XRDI systems. The initiative aims to enhance airport security, with a planned airport trial in 2026. (Client Announcements)
- Starlab Space LLC selected Leidos to lead the assembly, integration and testing of its U.S.-based commercial space station. The project supports readiness for NASA, international partners and commercial users following the International Space Station. (Client Announcements)
- The company completed a repurchase of 559,181 shares totaling $100.02 million as part of its ongoing buyback program initiated in 2022. (Buyback Tranche Update)
- Leidos Holdings reaffirmed its 2025 revenue guidance and projects revenue between $17.00 billion and $17.25 billion for the fiscal year. (Corporate Guidance New/Confirmed)
- The board of directors approved a quarterly cash dividend increase to $0.43 per share, representing a $0.03 rise over the previous payout. (Dividend Increases)
Valuation Changes
- Fair Value: Remained unchanged at $218.08 per share compared to the previous assessment.
- Discount Rate: Increased slightly from 7.53% to 7.56%.
- Revenue Growth: Held nearly steady, with a minor decrease from 2.56% to 2.56%.
- Net Profit Margin: Remained effectively unchanged at 8.66%.
- Future P/E: Rose marginally from 19.76x to 19.77x.
Disclaimer
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