RESTON, Va. - Leidos Holdings , Inc. (NYSE:LDOS), a company known for its role in addressing complex challenges in national security and health, has been awarded a contract to modernize the U.S. Army's network infrastructure. The contract, which aligns with the Army's Network (LON:NETW) Modernization Strategy and Army Unified Network Plan, has a potential total value of $331 million, encompassing a one-year base period and four one-year options.
This initiative is aimed at deploying the Army's Global Unified Network (AGUN), which leverages Software Defined Network technologies and supports the Army's transition to a Zero Trust Architecture. This will allow for the divestiture of the Joint Regional Security Stacks. As part of the contract, Leidos will standardize and orchestrate a modern network architecture across individual Army sites worldwide, enhancing the accessibility, trust, and interoperability of applications, data, and services.
Leidos' President of Digital Modernization, Steve Hull, expressed the company's commitment to the U.S. Army's modernization efforts, stating that the contract represents a significant milestone. Hull highlighted the importance of the Global Unified Network in advancing military communication capabilities in a complex global landscape.
The company, which employs approximately 48,000 people, reported annual revenues of around $15.4 billion for the fiscal year ending December 29, 2023. Leidos has positioned itself as an innovation leader within the Fortune 500, focusing on vital missions for both government and commercial customers.
The announcement also included a cautionary note regarding forward-looking statements, which are subject to risks and uncertainties and are not guarantees of future results.
The information provided in this article is based on a press release statement from Leidos Holdings, Inc. The details of the contract highlight Leidos' ongoing role in supporting the U.S. military's technological advancements and underscore the company's strategic partnerships with defense initiatives.
In other recent news, Leidos has been making substantial strides in its operations and financial performance. The company reported a 7.7% increase in year-over-year revenue, reaching $4.13 billion, and a 33% rise in adjusted EBITDA to $559 million. Leidos also secured several significant contracts, including a $249 million contract to enhance security at Army installation access points, a $303 million contract from the Department of the Air Force for the management of the Advanced Battle Management System, and a $51 million contract from the Centers for Disease Control and Prevention for the enhancement of the National Healthcare Safety Network. Truist Securities upgraded its price target for Leidos, citing potential value from its existing portfolio and opportunities for profit margin expansion. Leidos also recently announced leadership changes, appointing Leslie Fautsch as its new chief human resources officer and Thomas J. Downey as the new Executive Vice President and Chief Communications and Marketing Officer. These are recent developments in the company's performance and strategic focus.
InvestingPro Insights
Leidos Holdings' recent $331 million contract with the U.S. Army aligns well with the company's strong market position and financial performance. According to InvestingPro data, Leidos boasts a market capitalization of $22.84 billion, reflecting its significant presence in the defense and technology sectors. The company's revenue for the last twelve months as of Q2 2024 stood at $16.01 billion, with a healthy revenue growth of 7.86% over the same period.
InvestingPro Tips highlight Leidos as a prominent player in the Professional Services industry, which is consistent with its role in modernizing the Army's network infrastructure. The company's ability to secure such high-value contracts is likely contributing to its strong financial performance, with analysts predicting profitability for the current year.
Investors should note that Leidos is trading near its 52-week high, with a remarkable 84.97% price total return over the past year. This performance suggests that the market is responding positively to the company's strategic initiatives and contract wins like the one described in the article.
It's worth mentioning that Leidos has maintained dividend payments for 13 consecutive years and has raised its dividend for 5 consecutive years, indicating a commitment to shareholder returns alongside its business growth. The company's dividend yield stands at 0.9%, with a dividend growth of 5.56% in the last twelve months.
For readers interested in a more comprehensive analysis, InvestingPro offers 14 additional tips for Leidos Holdings, providing deeper insights into the company's financial health and market position.
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