Leidos (LDOS) Valuation: Assessing Upside After Recent Share Price Strength

Leidos Holdings (LDOS) has seen its stock performance shift over the past month, drawing attention from investors interested in its steady presence in defense and digital modernization. Its recent returns reflect ongoing questions about valuation and long-term growth potential.

See our latest analysis for Leidos Holdings.

Leidos Holdings’ share price has seen some profit-taking after an impressive rally earlier this year, holding recent gains despite a pullback of just over 1% in the past month. The momentum is still apparent when you consider its 31.5% year-to-date share price return and a healthy 16% total shareholder return over the past 12 months. This suggests that market confidence in the company’s growth narrative is sticking around for now.

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With shares now trading at a notable discount to analyst price targets and showing strong recent gains, the question for investors becomes clear: is Leidos still undervalued, or is future growth already reflected in the current price?

Most Popular Narrative: 13.6% Undervalued

With Leidos Holdings closing at $188.42 and the narrative’s fair value set at $218.08, the market appears to be discounting upside potential. The following narrative highlights what could be the most powerful catalyst behind this valuation.

Leidos is positioned to benefit from increased, multi-year government funding focused on national security, defense modernization, border protection, and infrastructure, particularly through the One Big Beautiful Bill and related initiatives (for example, FAA air traffic modernization, Golden Dome, maritime autonomy), which are expected to drive robust future revenue growth across core projects.

Read the complete narrative.

Want to know what’s fueling this optimistic price target? One core ingredient of this narrative is a growth runway that relies on transformative funding, profit durability, and a bold vision for the next era of digital modernization. Curious about the underlying financial leaps and market expectations that power this valuation? You have to see what’s behind the number.

Result: Fair Value of $218.08 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, it is worth noting that reliance on government funding and heightened competition could limit Leidos' future growth if conditions change unexpectedly.

Find out about the key risks to this Leidos Holdings narrative.

Build Your Own Leidos Holdings Narrative

If you see things differently or enjoy digging into the details yourself, you can easily build your own perspective in just a few minutes. Do it your way.

A great starting point for your Leidos Holdings research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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