We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Science Applications International Corporation (SAIC - Free Report) reported second-quarter fiscal 2024 adjusted earnings of $2.05 per share, surpassing the Zacks Consensus Estimate by 25.15%. The figure increased 17.1% year over year.
Revenues decreased 2.6% year over year to $1.78 billion but outpaced the consensus mark by 5.43%. The year-over-year decline was primarily attributed to the sale of the logistics and supply chain management business, the deconsolidation of the Forfeiture Support Associates J.V. and contract completions.
Adjusted EBITDA was $174 million, up 5% year over year. The adjusted EBITDA margin expanded 70 basis points (bps) on a year-over-year basis to 9.8%. The year-over-year growth was driven by strong program performance and cost-efficiency initiatives.
Quarter in Detail
Net bookings for the fiscal second quarter were $0.7 billion, reflecting a book-to-bill ratio of 0.4. SAIC’s estimated backlog of signed business deals was $22.5 billion at the end of the fiscal second quarter, of which $3.7 billion was funded.
Selling, general and administrative (SG&A) expenses decreased 5.4% year over year to $88 million. SG&A expenses, as a percentage of revenues, declined 10 bps to 4.9%.
Science Applications International Corporation Price, Consensus and EPS Surprise
Non-GAAP operating income increased 7.2% year over year to $134 million. The non-GAAP operating margin expanded 70 bps year over year to 7.5%.
Balance Sheet & Cash Flow Details
Science Applications ended the fiscal second quarter with cash and cash equivalents of $352 million, down from the prior quarter’s $422 million.
As of Aug 4, 2023, Science Applications’ long-term debt (net of the current portion) was $2.22 billion compared with $2.33 billion as of May 5, 2023.
The company generated operating and free cash flows of $150 million and $144 million, respectively, in the fiscal second quarter. The company generated operating and free cash flows of $82 million and $76 million, respectively, in the previous quarter.
Raised Fiscal 2024 Guidance
SAIC raised its guidance for the full fiscal 2024. The company now anticipates revenues in the band of $7.20-$7.25 billion in fiscal 2024 instead of the earlier projected range of $7.125-$7.225 billion.
Science Applications now expects adjusted earnings in the band of $7.20-$7.40 per share, up from the previous range of $7-$7.20.
SAIC still expects to generate free cash flow between $460 million and $480 million in fiscal 2024. It continues to project the adjusted EBITDA margin between 9.3% and 9.4% in fiscal 2024.
Zacks Rank & Stocks to Consider
Science Applications currently carries a Zacks Rank #3 (Hold).
Check Point Software (CHKP - Free Report) , Freshwork (FRSH - Free Report) , and Splunk are some better-ranked stocks that investors can consider in the broader sector. While Check Point Software and Freshwork carry a Zacks Rank #2 (Buy) each, Splunk sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Check Point Software shares have gained 7.5% year to date. The long-term earnings growth rate is pegged at 7.57%.
Freshwork shares have gained 57.6% year to date. The long-term earnings growth rate is pegged at 30%.
Splunk shares have gained 44% year to date. The long-term earnings growth rate is pegged at 24.71%.
See More Zacks Research for These Tickers
Pick one free report - opportunity may be withdrawn at any time
Image: Shutterstock
Science Applications (SAIC) Q2 Earnings & Sales Beat Estimates
Science Applications International Corporation (SAIC - Free Report) reported second-quarter fiscal 2024 adjusted earnings of $2.05 per share, surpassing the Zacks Consensus Estimate by 25.15%. The figure increased 17.1% year over year.
Revenues decreased 2.6% year over year to $1.78 billion but outpaced the consensus mark by 5.43%. The year-over-year decline was primarily attributed to the sale of the logistics and supply chain management business, the deconsolidation of the Forfeiture Support Associates J.V. and contract completions.
Adjusted EBITDA was $174 million, up 5% year over year. The adjusted EBITDA margin expanded 70 basis points (bps) on a year-over-year basis to 9.8%. The year-over-year growth was driven by strong program performance and cost-efficiency initiatives.
Quarter in Detail
Net bookings for the fiscal second quarter were $0.7 billion, reflecting a book-to-bill ratio of 0.4. SAIC’s estimated backlog of signed business deals was $22.5 billion at the end of the fiscal second quarter, of which $3.7 billion was funded.
Selling, general and administrative (SG&A) expenses decreased 5.4% year over year to $88 million. SG&A expenses, as a percentage of revenues, declined 10 bps to 4.9%.
Science Applications International Corporation Price, Consensus and EPS Surprise
Science Applications International Corporation price-consensus-eps-surprise-chart | Science Applications International Corporation Quote
Non-GAAP operating income increased 7.2% year over year to $134 million. The non-GAAP operating margin expanded 70 bps year over year to 7.5%.
Balance Sheet & Cash Flow Details
Science Applications ended the fiscal second quarter with cash and cash equivalents of $352 million, down from the prior quarter’s $422 million.
As of Aug 4, 2023, Science Applications’ long-term debt (net of the current portion) was $2.22 billion compared with $2.33 billion as of May 5, 2023.
The company generated operating and free cash flows of $150 million and $144 million, respectively, in the fiscal second quarter. The company generated operating and free cash flows of $82 million and $76 million, respectively, in the previous quarter.
Raised Fiscal 2024 Guidance
SAIC raised its guidance for the full fiscal 2024. The company now anticipates revenues in the band of $7.20-$7.25 billion in fiscal 2024 instead of the earlier projected range of $7.125-$7.225 billion.
Science Applications now expects adjusted earnings in the band of $7.20-$7.40 per share, up from the previous range of $7-$7.20.
SAIC still expects to generate free cash flow between $460 million and $480 million in fiscal 2024. It continues to project the adjusted EBITDA margin between 9.3% and 9.4% in fiscal 2024.
Zacks Rank & Stocks to Consider
Science Applications currently carries a Zacks Rank #3 (Hold).
Check Point Software (CHKP - Free Report) , Freshwork (FRSH - Free Report) , and Splunk are some better-ranked stocks that investors can consider in the broader sector. While Check Point Software and Freshwork carry a Zacks Rank #2 (Buy) each, Splunk sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Check Point Software shares have gained 7.5% year to date. The long-term earnings growth rate is pegged at 7.57%.
Freshwork shares have gained 57.6% year to date. The long-term earnings growth rate is pegged at 30%.
Splunk shares have gained 44% year to date. The long-term earnings growth rate is pegged at 24.71%.