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Booz Allen Hamilton (BAH) Gains As Market Dips: What You Should Know

Zacks Equity Research

Booz Allen Hamilton (BAH) closed the most recent trading day at $73.74, moving +0.01% from the previous trading session. This change outpaced the S&P 500's 0.7% loss on the day. Meanwhile, the Dow lost 0.92%, and the Nasdaq, a tech-heavy index, added 0.51%.

Investors will be hoping for strength from BAH as it approaches its next earnings release, which is expected to be May 26, 2020. The company is expected to report EPS of $0.70, up 9.38% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.94 billion, up 9.01% from the year-ago period.

It is also important to note the recent changes to analyst estimates for BAH. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 2.53% lower. BAH is holding a Zacks Rank of #3 (Hold) right now.

In terms of valuation, BAH is currently trading at a Forward P/E ratio of 21.44. This represents a premium compared to its industry's average Forward P/E of 17.96.

It is also worth noting that BAH currently has a PEG ratio of 1.8. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Government Services stocks are, on average, holding a PEG ratio of 1.79 based on yesterday's closing prices.

The Government Services industry is part of the Business Services sector. This group has a Zacks Industry Rank of 83, putting it in the top 33% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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