RESTON, Va. - Science Applications (NASDAQ:SAIC) International Corp. (NASDAQ: SAIC), a Fortune 500 technology integrator, has secured a $229 million contract from the U.S. Department of Defense. Under the NORAD/USNORTHCOM Information Technology Enterprise Services (NITES) program, SAIC will provide essential IT solutions, including service management, network modernization, and cybersecurity.
The contract is a strategic win for SAIC, leveraging its recent success in modernizing NORAD's command and control systems through the ABMS Cloud Based Command and Control program. The company aims to enhance the IT capabilities of NORAD and USNORTHCOM, which are critical in defending the United States.
SAIC's executive vice president for Air Force and Combatant Commands, Vinnie DiFronzo, emphasized the importance of delivering a resilient and highly available IT network for the warfighters with a no-fail mission. The company plans to apply its expertise in IT modernization, innovation, and efficiency to support the NITES program.
The services provided by SAIC will include the automation of existing IT systems, cloud migration, and the deployment of skilled professionals to ensure the smooth operation of the IT network. This contract aligns with SAIC's broader portfolio, which caters to defense, space, civilian, and intelligence markets, providing high-end solutions in mission IT and professional services.
SAIC, headquartered in Reston, Virginia, reports annual revenues of approximately $7.4 billion and employs around 24,000 people. The company is committed to a diverse and inclusive workforce, as it believes this is vital for attracting and retaining exceptional talent.
This announcement is based on a press release statement from SAIC. The company's forward-looking statements are subject to various factors and uncertainties, and there is no assurance that the projected outcomes will be achieved. SAIC disclaims any obligation to update forward-looking statements or to comment on reports published by investment analysts or others.
In other recent news, Science Applications International Corp. (SAIC) has been the subject of analysts' attention, with Jefferies revising their price target from $135.00 to $140.00. This follows SAIC's second fiscal quarter results, which showed a 2% increase in revenue and a slight 2% decrease in EBITDA. The company's performance surpassed expectations, leading to a revised fiscal year 2025 forecast, now predicting 3% revenue growth and 4% EBITDA growth. However, caution remains over the anticipated growth trajectory.
In the recent earnings call, SAIC reported a 2% year-over-year organic revenue growth, an adjusted EBITDA of $170 million, and a robust free cash flow of $241 million. The company aims to hit a book-to-bill ratio of 1.2x by the first half of fiscal year 2026 and a 5% organic revenue growth by the end of the same fiscal year. Despite acknowledging risks related to contract protests and the impact of elections on their book-to-bill targets, executives expressed confidence in their strategy to drive sustainable growth.
SAIC's recent developments indicate a strategic transition towards targeted growth areas and improved bidding processes. The company's revised price target reflects its solid financial performance and updated growth projections, while also taking into account the comparative analysis of the company's growth rate against its industry peers.
InvestingPro Insights
Science Applications International Corp. (SAIC) has demonstrated a strong commitment to enhancing shareholder value, as reflected by its aggressive share buyback strategy. This aligns with the company's recent strategic win of a $229 million defense contract, which may further support its financial stability and growth prospects. SAIC's dedication to shareholder returns is also evident in its high shareholder yield, a positive indicator for investors seeking companies with a proactive approach to capital distribution.
The company's financial metrics, as per recent data, show a market capitalization of $6.64 billion, with a Price/Earnings (P/E) ratio of 24.06, which adjusts to 21.6 over the last twelve months as of Q2 2025. Despite a slight decline in revenue growth by 5.1% over the same period, SAIC has managed to maintain a gross profit of $844 million with a margin of 11.57%. Additionally, the company has achieved a strong return over the last three months, with a 16.72% price total return, underscoring its resilience in the market.
Investors should note that while SAIC has been profitable over the last twelve months, 5 analysts have revised their earnings downwards for the upcoming period. This suggests that while the company is currently on solid ground, there may be challenges ahead that could impact its financial performance. Nonetheless, SAIC's stock generally trades with low price volatility, which may appeal to investors looking for stability in their portfolio.
For those interested in a more in-depth analysis, InvestingPro offers additional insights and metrics on SAIC. Currently, there are 11 more InvestingPro Tips available, which can be found at InvestingPro SAIC, providing a comprehensive view of the company's financial health and market performance.
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