Parsons Corp (PSN)
NYSE:PSN
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Parsons
(NYSE:PSN)
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Rating:61Neutral
Price Target:
$62.00
▲(11.21% Upside)
Action:Reiterated
Date:04/29/26
The score is primarily supported by improving margins and steady free cash flow, plus a constructive earnings call with reaffirmed guidance and record backlog/bookings. These positives are tempered by a notably weak technical setup (price below major moving averages with negative MACD), a relatively high P/E with no dividend support, and elevated financial risk from slowing recent revenue trends and rising debt.
Positive Factors
Margin expansion & cash generation
Sustained margin expansion to a record 10.1% and record adjusted EBITDA demonstrate improving operational efficiency and pricing/ mix benefits. Combined with strong free cash flow conversion, this durable profitability supports reinvestment, debt servicing, and shareholder returns through cycles.
Negative Factors
Softening revenue momentum
A recent decline in reported revenue and negative TTM growth weakens operating leverage and raises sensitivity to contract timing. If top‑line volumes persist below trend, margin gains could be harder to sustain and backlog conversion will be critical to restore durable growth.
Read all positive and negative factors
Positive Factors
Negative Factors
Margin expansion & cash generation
Sustained margin expansion to a record 10.1% and record adjusted EBITDA demonstrate improving operational efficiency and pricing/ mix benefits. Combined with strong free cash flow conversion, this durable profitability supports reinvestment, debt servicing, and shareholder returns through cycles.
Read all positive factors
Parsons (PSN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$6.19B
Dividend YieldN/A
Average Volume (3M)1.42M
Price to Earnings (P/E)27.2
Beta (1Y)0.78
Revenue Growth-6.92%
EPS Growth-44.47%
CountryUS
Employees20,000
SectorTechnology
Sector Strength88
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)2.13
Shares Outstanding106,978,520
10 Day Avg. Volume1,462,365
30 Day Avg. Volume1,418,584
Financial Highlights & Ratios
PEG Ratio12.10
Price to Book (P/B)2.50
Price to Sales (P/S)1.04
P/FCF Ratio16.09
Enterprise Value/Market Cap1.25
Enterprise Value/Revenue1.22
Enterprise Value/Gross Profit5.38
Enterprise Value/Ebitda14.81
Forecast
1Y Price Target
$68.58Price Target Upside23.02% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering13
EPS Forecast (FY)3.33
Revenue Forecast (FY)$6.64B
Parsons Business Overview & Revenue Model
Company Description
Parsons Corporation is a global provider of comprehensive solutions and services, primarily operating in the defense, intelligence, and critical infrastructure sectors. Its reach extends across North America, the Middle East, and other internation...
How the Company Makes Money
Parsons makes money primarily by performing services and delivering solutions under contracts—most often with U.S. government agencies—and recognizing revenue as work is executed. Key revenue streams include: (1) Federal Solutions: revenue from pr...
Parsons Earnings Call Summary
Earnings Call Date:Apr 29, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 05, 2026
Earnings Call Sentiment Positive
The call conveyed a broadly positive operational and financial picture: record adjusted EBITDA margin, record total and funded backlog, strong bookings and multiple large strategic awards, completion of a strategic acquisition, and robust cash conversion. Offsetting items included working capital timing (DSO increase), higher SG&A from recent acquisitions, mixed revenue comparatives driven by a confidential contract, and conservative near-term phasing that lowers Q2 expectations. Overall the company emphasized resilience, strong forward indicators (pipeline, win rates, awards), and reiterated full-year guidance.Positive Updates
Record Adjusted EBITDA Margin
Adjusted EBITDA margin reached a record 10.1% (up 50 bps year-over-year) with record first-quarter adjusted EBITDA of $151 million (up 1% year-over-year). Critical Infrastructure margin hit 10.8%, a Q1 record.
Negative Updates
Mixed Revenue Comparisons Due to Confidential Contract
Reported revenue comparisons vary by inclusion of a confidential contract: total revenue grew 8% overall and organic revenue grew 3% excluding the confidential contract, but total revenue including the confidential contract decreased 4% year-over-year and was down 8% on an organic basis, creating complexity in top-line interpretation.
Read all updates
Q1-2026 Updates
Positive
Negative
Record Adjusted EBITDA Margin
Adjusted EBITDA margin reached a record 10.1% (up 50 bps year-over-year) with record first-quarter adjusted EBITDA of $151 million (up 1% year-over-year). Critical Infrastructure margin hit 10.8%, a Q1 record.
Read all positive updates
Company Guidance
Parsons reiterated its 2026 guidance ranges, supported by a strong Q1 and detailed assumptions: organic revenue growth assumptions of ~6.6% for Federal Solutions (ex‑confidential) and ~6.1% for Critical Infrastructure, with first‑half/second‑half splits of roughly 4%/9% for Federal and ~3%/9% for CI; segment margin targets of high‑8s/low‑9s for Federal and ~10.5% midpoint for CI (Q1 adjusted EBITDA margin was a record 10.1%); balance‑sheet and cash metrics including $9.3B total backlog ($6.6B funded, 71% funded), $11B of awards not yet booked, $2.0B of Q1 contract awards with a 1.4x Q1 book‑to‑bill (both segments) and an expected >1.0 book‑to‑bill in Q2, recomplete risk <3% of 2026 revenue, net debt leverage of 2.0x, trailing‑12‑month free cash conversion of 102%, Q1 CapEx of $15M with a planned ramp in Q2, DSO of 72 days, and a lowered Q2 cadence due to timing of recent awards but continued confidence in meeting full‑year guidance.Parsons Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
70
Positive
Cash Flow
66
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 6.30B | 6.36B | 6.75B | 5.44B | 4.20B | 3.66B |
| Gross Profit | 1.43B | 1.43B | 1.41B | 1.21B | 946.72M | 852.82M |
| EBITDA | 520.82M | 534.68M | 518.48M | 415.52M | 309.91M | 274.49M |
| Net Income | 227.86M | 241.14M | 235.05M | 161.15M | 96.66M | 64.07M |
Balance Sheet | ||||||
| Total Assets | 6.01B | 5.77B | 5.49B | 4.80B | 4.20B | 3.83B |
| Cash, Cash Equivalents and Short-Term Investments | 283.92M | 466.39M | 453.55M | 272.94M | 262.54M | 342.61M |
| Total Debt | 1.68B | 1.48B | 1.42B | 927.15M | 916.41M | 799.14M |
| Total Liabilities | 3.26B | 3.00B | 2.95B | 2.43B | 2.10B | 1.89B |
| Stockholders Equity | 2.65B | 2.64B | 2.42B | 2.29B | 2.04B | 1.90B |
Cash Flow | ||||||
| Free Cash Flow | 417.05M | 410.41M | 474.39M | 367.30M | 206.93M | 184.47M |
| Operating Cash Flow | 486.47M | 478.38M | 523.61M | 407.70M | 237.53M | 205.57M |
| Investing Cash Flow | -557.18M | -254.00M | -556.72M | -375.97M | -417.47M | -240.91M |
| Financing Cash Flow | 81.93M | -215.68M | 218.75M | -21.87M | 100.37M | -106.50M |
Parsons Technical Analysis
Neutral
55.75
Price Trends
54.25
Positive
59.13
Negative
68.34
Negative
Market Momentum
1.87
Negative
57.00
Neutral
61.76
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PSN, the sentiment is Neutral. The current price of 55.75 is above the 20-day moving average (MA) of 55.13, above the 50-day MA of 54.25, and below the 200-day MA of 68.34, indicating a neutral trend. The MACD of 1.87 indicates Negative momentum. The RSI at 57.00 is Neutral, neither overbought nor oversold. The STOCH value of 61.76 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for PSN.
Parsons Risk Analysis
Parsons disclosed 56 risk factors in its most recent earnings report. Parsons reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Parsons Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $10.53B | 28.85 | 18.38% | 0.70% | 14.22% | 25.22% | |
72 Outperform | $11.51B | 44.19 | 12.67% | ― | 17.39% | 20.78% | |
71 Outperform | $9.73B | 22.18 | 25.19% | 1.28% | 4.44% | 25.08% | |
64 Neutral | $14.00B | 48.79 | 4.23% | 0.97% | 1.54% | 22.59% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
61 Neutral | $6.19B | 27.20 | 8.79% | ― | -6.92% | -44.47% | |
58 Neutral | $7.12B | -17.71 | -14.35% | ― | -4.89% | -179.82% |
* Technology Sector Average
PSN
Parsons
57.83
-11.69
-16.82%
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Parsons Corporate Events
Executive/Board ChangesShareholder Meetings
Parsons Shareholders Reelect Directors and Back Governance Measures
Positive
Apr 15, 2026
At its annual meeting of stockholders held on April 14, 2026, Parsons Corporation shareholders elected four directors—Carey A. Smith, Letitia A. Long, Harry T. McMahon, and Robert H. Smith—to three-year terms ending at the 2029 annual ...
Business Operations and StrategyExecutive/Board Changes
Parsons Announces CHRO Transition and Leadership Succession Plan
Positive
Mar 17, 2026
Parsons Corporation announced on March 17, 2026 that Chief Human Resources Officer Susan Balaguer will retire effective April 1, 2026, and will stay on in an advisory capacity through the end of May to support the transition. The board approved a ...
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.