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Science Applications
(NASDAQ:SAIC)
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Rating:72Outperform
Price Target:
$114.00
▲(19.52% Upside)
Action:Reiterated
Date:06/09/26
SAIC’s score is driven primarily by strong cash flow generation and improved profitability outlook from the latest earnings call, supported by a favorable-looking valuation (P/E ~12.3) and a clear bullish price trend. The main constraints are modest underlying margins, elevated leverage, and identifiable FY2027 organic growth/timing headwinds (e.g., RITS recompete and slower award environment).
Positive Factors
Cash generation
Sustained trailing‑12‑month operating and free cash flow near $636M demonstrates durable cash conversion from earnings. That level of FCF supports reinvestment, disciplined buybacks, debt paydown and dividend capacity, strengthening financial optionality across economic cycles.
Negative Factors
Elevated leverage
Material leverage increases financial sensitivity to interest costs, constrains strategic flexibility, and raises refinancing risk during downturns. While management is deleveraging as EBITDA improves, the current debt load limits capital deployment choices and amplifies execution risk.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation
Sustained trailing‑12‑month operating and free cash flow near $636M demonstrates durable cash conversion from earnings. That level of FCF supports reinvestment, disciplined buybacks, debt paydown and dividend capacity, strengthening financial optionality across economic cycles.
Read all positive factors
Science Applications Key Performance Indicators (KPIs)
Any
Total Backlog
Indicates the total value of contracted work yet to be completed, highlighting future revenue streams and the company's ability to secure long-term projects.
Indicates the total value of contracted work yet to be completed, highlighting future revenue streams and the company's ability to secure long-term projects.
Data provided by:
The Fly
The FlyScience Applications (SAIC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.69B
Dividend Yield1.69%
Average Volume (3M)608.01K
Price to Earnings (P/E)12.4
Beta (1Y)0.30
Revenue Growth-2.90%
EPS Growth24.61%
CountryUS
Employees24,000
SectorTechnology
Sector Strength88
IndustryInformation Technology Services
Share Statistics
EPS (TTM)8.94
Shares Outstanding42,276,817
10 Day Avg. Volume606,024
30 Day Avg. Volume608,015
Financial Highlights & Ratios
PEG Ratio1.90
Price to Book (P/B)3.14
Price to Sales (P/S)0.65
P/FCF Ratio8.17
Enterprise Value/Market Cap1.51
Enterprise Value/Revenue0.97
Enterprise Value/Gross Profit7.76
Enterprise Value/Ebitda9.63
Forecast
1Y Price Target
$118.63Price Target Upside24.37% Upside
Rating ConsensusHold
Number of Analyst Covering11
EPS Forecast (FY)10.15
Revenue Forecast (FY)$7.19B
Science Applications Business Overview & Revenue Model
Company Description
Science Applications International Corporation (SAIC), a U.S.-based firm, specializes in providing a wide array of advanced technical, engineering, and comprehensive information technology (IT) solutions. Its diverse offerings span crucial areas s...
How the Company Makes Money
SAIC makes money primarily by providing services and integrated solutions to government agencies under contract. Revenue is largely generated from long-term and multi-year contract awards (including task orders under IDIQ-style vehicles) where SAI...
Science Applications Earnings Call Summary
Earnings Call Date:Jun 01, 2026
(Q1-2027)
| % Change Since: |
Next Earnings Date:Sep 03, 2026
Earnings Call Sentiment Positive
The call emphasized strong operational execution in Q1 — record margins, robust adjusted EBITDA ($222M), improved civil margins (~15%), upgraded EPS and EBITDA guidance, solid free cash flow generation and active capital return via buybacks. Management remains cautious on sales for FY27 due to recompete timing (notably RITS), a smaller/reshaped enterprise IT pipeline, slower RFP timing and election-year/appropriations uncertainty. While some margin upside in the quarter was aided by a one-time venture gain, underlying cash flow and deleveraging progress are clear. Overall, the company appears to be making deliberate strategic changes (portfolio and pipeline focus) and has momentum on margins and cash, but faces identifiable timing and organic growth risks that management is actively managing.Positive Updates
Record Margin and Strong Adjusted EBITDA
Fiscal Q1 adjusted EBITDA of $222 million and a company-record margin driven by strong program execution; sale of a venture investment contributed roughly $12 million, adding ~60 basis points to EBITDA margin and about $0.20 to EPS.
Negative Updates
RITS Recompete Headwind and Timing Shift
Unsuccessful RITS recompete expected to be a ~$200 million headwind in FY27; roll-off timing shifted later (now likely to impact Q3 rather than Q2) due to a protest, creating sequential timing pressure in the second half of the year.
Read all updates
Q1-2027 Updates
Positive
Negative
Record Margin and Strong Adjusted EBITDA
Fiscal Q1 adjusted EBITDA of $222 million and a company-record margin driven by strong program execution; sale of a venture investment contributed roughly $12 million, adding ~60 basis points to EBITDA margin and about $0.20 to EPS.
Read all positive updates
Company Guidance
SAIC maintained its FY2027 sales guidance but raised profitability and EPS outlook after a strong F1Q: Q1 revenue $1.9B (+0.5% organic), adjusted EBITDA $222M (included $12M venture IPO gain that added ~60bps to EBITDA margin and ~$0.20 to EPS), adjusted diluted EPS $3.23, free cash flow $118M, net leverage down to 3.1x, net bookings $2.1B (book‑to‑bill 1.1x; 1.0x TTM) and a qualified pipeline of ~$85B. Management raised full‑year adjusted EBITDA margin guidance to 10.1%–10.3% (up ~20bps), increased adjusted EPS guidance ~4% to $9.90–$10.10, reiterated FCF >$600M and at least $14 FCF/share in FY27 (and ≥$13 in FY28), expects on‑contract growth of 2%–3%, will revisit organic growth (previous guide −2% to −4%) at Q2, repurchased $188M this quarter toward a ~ $400M buyback plan, and said the ~$200M RITS recompete headwind will likely roll off in Q3 (implying roughly a ~3% organic drag in each of Q3 and Q4).Science Applications Financial Statement Overview
Summary
Income Statement
66
Positive
Balance Sheet
62
Positive
Cash Flow
75
Positive
| Breakdown | TTM | Jan 2026 | Jan 2025 | Jan 2024 | Jan 2023 | Jan 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 7.29B | 7.26B | 7.48B | 7.44B | 7.70B | 7.39B |
| Gross Profit | 912.00M | 879.00M | 892.00M | 872.00M | 888.00M | 859.00M |
| EBITDA | 735.00M | 661.00M | 686.00M | 882.00M | 650.00M | 628.00M |
| Net Income | 405.00M | 358.00M | 362.00M | 477.00M | 300.00M | 277.00M |
Balance Sheet | ||||||
| Total Assets | 5.34B | 5.35B | 5.25B | 5.31B | 5.54B | 5.75B |
| Cash, Cash Equivalents and Short-Term Investments | 109.00M | 182.00M | 56.00M | 94.00M | 109.00M | 106.00M |
| Total Debt | 2.67B | 2.71B | 2.39B | 2.25B | 2.53B | 2.71B |
| Total Liabilities | 3.92B | 3.85B | 3.67B | 3.53B | 3.84B | 4.12B |
| Stockholders Equity | 1.42B | 1.50B | 1.58B | 1.78B | 1.69B | 1.62B |
Cash Flow | ||||||
| Free Cash Flow | 603.00M | 577.00M | 458.00M | 369.00M | 507.00M | 482.00M |
| Operating Cash Flow | 636.00M | 609.00M | 494.00M | 396.00M | 532.00M | 518.00M |
| Investing Cash Flow | -232.00M | -248.00M | -35.00M | 314.00M | -36.00M | -292.00M |
| Financing Cash Flow | -342.00M | -235.00M | -498.00M | -725.00M | -493.00M | -301.00M |
Science Applications Technical Analysis
Positive
95.38
Price Trends
102.76
Positive
98.02
Positive
97.98
Positive
Market Momentum
1.36
Positive
55.22
Neutral
69.05
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SAIC, the sentiment is Positive. The current price of 95.38 is below the 20-day moving average (MA) of 109.97, below the 50-day MA of 102.76, and below the 200-day MA of 97.98, indicating a bullish trend. The MACD of 1.36 indicates Positive momentum. The RSI at 55.22 is Neutral, neither overbought nor oversold. The STOCH value of 69.05 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SAIC.
Science Applications Risk Analysis
Science Applications disclosed 29 risk factors in its most recent earnings report. Science Applications reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Science Applications Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $4.69B | 12.41 | 27.22% | 1.69% | -2.90% | 24.61% | |
71 Outperform | $1.73B | 2.65 | 59.52% | 0.80% | 3.31% | 665.00% | |
71 Outperform | $4.93B | 8.82 | 22.44% | 1.41% | 6.47% | 10.82% | |
68 Neutral | $13.69B | 9.87 | 29.15% | 0.87% | 2.34% | 10.44% | |
65 Neutral | $11.11B | 20.63 | 13.15% | ― | 9.58% | 14.11% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
51 Neutral | $2.70B | 14.32 | 16.40% | ― | 0.23% | -20.13% |
* Technology Sector Average
SAIC
Science Applications
110.96
-4.94
-4.26%
CACI
Caci International
502.83
-2.17
-0.43%
FORTY
Formula Systems
108.50
-13.18
-10.83%
G
Genpact
29.10
-16.12
-35.65%
LDOS
Leidos Holdings
108.84
-53.91
-33.12%
KD
Kyndryl Holdings Incorporation
12.25
-30.38
-71.26%
Science Applications Corporate Events
Business Operations and StrategyExecutive/Board ChangesShareholder Meetings
Science Applications Shareholders Endorse Board, Pay and Equity Plan
Positive
Jun 8, 2026
Science Applications International Corporation held its virtual Annual Meeting of Stockholders on June 3, 2026, with approximately 83.5% of outstanding shares represented, and stockholders elected all director nominees to one-year terms and approv...
Business Operations and StrategyExecutive/Board Changes
Science Applications Announces Leadership Change in Civilian Business Group
Neutral
Jun 1, 2026
On June 1, 2026, Science Applications International Corporation disclosed that Executive Vice President of its Civilian Business Group, Srinivas Attili, had stepped down from his role effective May 29, 2026. He is scheduled to leave the company on...
Dividends
Science Applications Declares Quarterly Cash Dividend to Shareholders
Positive
May 29, 2026
On May 28, 2026, SAIC’s board of directors declared a cash dividend of $0.37 per share on the company’s common stock, payable on July 24, 2026 to shareholders of record as of July 10, 2026. The move continues SAIC’s pattern of re...
Business Operations and StrategyExecutive/Board Changes
Science Applications Adds AI and Cybersecurity Leaders to Board
Positive
Apr 9, 2026
On April 9, 2026, Science Applications International Corporation announced the appointment of technologist Paul Eremenko and retired Admiral Michael Rogers to its Board of Directors for a term beginning April 8, 2026 and running until the 2026 ann...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.