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Here's How Much You'd Have If You Invested $1000 in Booz Allen Hamilton a Decade Ago

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For most investors, how much a stock's price changes over time is important. Not only can it impact your investment portfolio, but it can also help you compare investment results across sectors and industries.

FOMO, or the fear of missing out, also plays a role in investing, particularly with tech giants and popular consumer-facing stocks.

What if you'd invested in Booz Allen Hamilton (BAH - Free Report) ten years ago? It may not have been easy to hold on to BAH for all that time, but if you did, how much would your investment be worth today?

Booz Allen Hamilton's Business In-Depth

With that in mind, let's take a look at Booz Allen Hamilton's main business drivers.

McLean, VA-based Booz Allen Hamilton Holding Corporation is a provider of management and technology consulting, analytics, engineering, digital solutions, mission operations as well as cyber expertise to the United States and international governments, corporations plus not-for-profit organizations. The company operates as a single profit center with a single bonus pool for partners, vice presidents, principals and senior associates.

The company serves a diverse base of federal government clients, helping them to tackle complex challenges such as protecting soldiers in combat and supporting their families, keeping national infrastructure secure, advancing cyber capabilities, enabling and enhancing digital services, transforming the healthcare system, and improving governmental efficiency.

Booz Allen has commercial clients from across various industries including aerospace, health and life sciences, energy, financial services and transportation.

Booz Allen was founded by Edwin Booz, one of the pioneers of management consulting, in 1914. The company started serving the U.S. government by advising the Secretary of the Navy in preparation for World War II. With changing needs of clients in terms of both nature and complexity, the company expanded beyond management consulting foundation to develop deep expertise in the analytics, engineering, digital solutions and cyber.

Booz Allen currently has five service offerings, namely Consulting, Analytics, Digital Solutions, Engineering and Server. Consulting solutions are offered to various domains like business strategies, human capital and operations. Analytics services are focused on delivering transformational solutions in the areas of decision analytics, data science and automation plus the emerging areas of artificial intelligence and deep learning. Digital Solutions combines modern system development techniques with cloud platforms and machine learning for providing powerful solutions to clients.

Engineering delivers an array of engineering services and solutions to complex systems like the Launch and Test Range System (LTRS) for the U.S. Air Force Space Command or the Flush Air Data Systems (FADS) for NASA. Cyber provides cyber risk management solutions, such as prevention, detection and cost effectiveness.

Bottom Line

Anyone can invest, but building a successful investment portfolio takes a combination of a few things: research, patience, and a little bit of risk. So, if you had invested in Booz Allen Hamilton a decade ago, you're probably feeling pretty good about your investment today.

According to our calculations, a $1000 investment made in May 2014 would be worth $6,685.36, or a 568.54% gain, as of May 28, 2024. Investors should keep in mind that this return excludes dividends but includes price appreciation.

Compare this to the S&P 500's rally of 177.46% and gold's return of 77.20% over the same time frame.

Going forward, analysts are expecting more upside for BAH.

Booz Allen's shares have surged 64.7% in the past year partly due to better-than-expected earnings performance in three of the past four quarters. Booz Allen’s VoLT strategy focuses on integrating velocity, leadership and technology in the process of transformation. The company is focusing on areas such as Artificial Intelligence, advanced engineering, directed energy and modern digital platforms. Booz Allen has a large addressable market as it serves the government which is one of the world’s largest consumers of technology and management consulting services. On the flip side, Booz Allen is seeing an escalation in operating costs and expenses have increased year over year in the past two years. Seasonality of business is also a negative.

Over the past four weeks, shares have rallied 7.41%, and there have been 3 higher earnings estimate revisions in the past two months for fiscal 2024 compared to none lower. The consensus estimate has moved up as well.

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