I read many posts saying that with the size of the defense budget shrinking that SAIC will be dragged down with it lose contract, and see an overall decrease in income. Is that what you all believe will happen? I realize no one has a crystal ball to know what's going to happen but there must be some opinions based upon recent SAIC experience to draw from. I have only 100 shares in this company so far, but would add to them if it looks good.
Yes it is. The cost of the split will be enormous in terms of one time costs and go forward duplicated overhead. For example, they already have 2 CEO's and 2 VP's of Human Resources with kingdoms to build. More coming in all areas. I imagine they are building an expensive split "tiger" team to slice and dice the contracts up into the 2 companies. The DOD will be in slash and burn mode and new contracts will be sparse. Who would want to work in a company that is in this mode?
I think that a lot of people are holding onto their shares because they are optomistic about the company splitting into two. Also another thought is that when the companies split and get smaller they will be bought out, therefore generating income for the shareholders.
As you said, no one has a crystal ball but personally all my shares were given to me when I was an SAIC employee as bonuses so it's all just play money. Oh, by the way it's giving a nice quarterly dividend right now.