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Science Applications’ Revenue Rose and Income Fell in Fiscal 3Q16

Gabriel Kane

Science Applications Reported Mixed Results for Fiscal 3Q16

Science Applications’ price movement

Science Applications International (SAIC) has a market cap of $2.4 billion. Its YTD (year-to-date) price movement was a mix of rises and falls in calendar 2015. After the fiscal 3Q16 earnings report, Science Applications rose by 2.1% to close at $51.60 per share as of December 2, 2015. The price movement on a weekly, monthly, and YTD basis is 7.6%, 12.8%, and 6.7%, respectively.

Technically, the stock broke the support of all the moving day averages throughout 2015. Currently, Science Applications is trading 9.5% above its 20-day moving average, 16.7% above its 50-day moving average, and 4.8% above its 200-day moving average.

The PureFunds ISE Cyber Security ETF (HACK) invests 3.6% of its holdings in Science Applications. HACK tracks a tiered, equal-weighted index that targets companies actively involved in providing cyber security technology and services. HACK’s YTD price movement is 3.6% as of December 1, 2015. The Guggenheim Spin-Off ETF (CSD) invests 3.0% of its holdings in Science Applications.

Science Applications’ competitors and their market caps are:

  • Accenture (ACN) – $70.4 billion
  • Booz Allen Hamilton (BAH) – $4.4 billion
  • ManTech International (MANT) – $1.2 billion

Science Applications’ performance in fiscal 3Q16

Science Applications reported total revenue of $1,136.0 million in fiscal 3Q16—a rise of 13.1% compared to the total revenue of $1,004.0 million in fiscal 3Q15. The company’s operating income rose by 1.6% in fiscal 3Q16—compared to the operating income in fiscal 3Q15. Its net income and EPS (earnings per share) fell to $34.0 million and $0.72, respectively, in fiscal 3Q16—compared to the net income and EPS of $37.0 million and $0.77, respectively, in fiscal 3Q15.

Its adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) rose to $82.0 million in fiscal 3Q16—a rise of 18.8% compared to the same period the year before.

Meanwhile, the cash and cash equivalents and receivables rose by 12.9% and 1.2%, respectively, on a quarterly basis in fiscal 3Q16. The company’s long-term DE (debt-to-equity) ratio fell to 2.66 in fiscal 3Q16—compared to the long-term DE ratio of 2.74 in fiscal 2Q16. The current ratio remained as 1.39 in fiscal 3Q16 and fiscal 2Q16.

The bookings for the quarter were ~$1.4 billion. This shows a book-to-bill ratio of ~1.2. At the end of the quarter, the backlog of signed business orders was ~$7.4 billion of which $2.1 billion was funded.

It declared a regular cash dividend of $0.31 per share. It also authorized the repurchase of up to five million shares on its common stock.

Science Applications appointed Steven G. Mahon as the executive vice president and general counsel. It appointed Sanjay Sardar as the vice president and service line director for Data Science.

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