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Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
The company delivered an earnings surprise of 16.37% in the last reported quarter. Moreover, the stock boasts a four-quarter average earnings surprise of 23.49%.
Let’s discuss the factors that are likely to be reflected in the upcoming quarterly results.
Key Factors to Consider
LDOS currently generates revenues from its four segments — National Security and Digital, Health & Civil, Commercial & International and Defense Systems.
Organic growth, driven by increased sales volume from the Sentinel and DES programs, is likely to have bolstered the National Security and Digital unit’s top-line performance in the to-be-reported quarter. Solid volume growth from several contracted research and development efforts is also expected to favorably contribute to this unit’s quarterly results.
Solid sales volume from the managed health services business, along with write-ups on certain programs, must have added an impetus to the Health & Civil unit’s third-quarter top line.
Increased deliveries of security products and higher sales volumes from its commercial energy as well as Australian businesses can be expected to have boosted LDOS’ Commercial & International unit’s revenues.
On the other hand, increased sales volume from prior contract wins might have bolstered the Defense Systems unit’s revenues.
The expected strong sales performance from most LDOS segments must have aided the company’s overall top line in the quarter.
Strong top-line expectations and disciplined cost management initiatives are likely to have boosted the company’s bottom-line performance. Also, with the company transitioning from development to production on some key programs of its Defense System unit, an improved operating margin (from this unit in particular) is expected to have aided its earnings growth.
However, the unfavorable impact of write-downs on certain programs within the company’s UK operations might have hurt LDOS’ overall earnings in the soon-to-be-reported quarter.
Q3 Estimates
The Zacks Consensus Estimate for revenues is pegged at $4.04 billion, indicating an increase of 3.2% from the year-ago level.
The Zacks Consensus Estimate for earnings is pegged at $1.96 per share, indicating a decline of 3.5% from the bottom line recorded a year ago.
Backlog Projections Suggest Growth
Our model expects Leidos’ backlog to decline 13.5% year over year to $32.89 billion.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for LDOS this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is the case here, as you will see below.
Earnings ESP: Leidos has an Earnings ESP of +2.78%. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Below we have mentioned a few other players from the same sector that have the right combination of elements to beat on earnings this reporting cycle.
Northrop Grumman (NOC - Free Report) is set to report third-quarter earnings on Oct. 24, before market open. It has an Earnings ESP of +1.13% and a Zacks Rank of 3 at present.
The Zacks Consensus Estimate for earnings is pegged at $6.07 per share. The consensus estimate for sales is pegged at $10.23 billion, which suggests a year-over-year improvement of 4.6%.
L3Harris Technologies, Inc. (LHX - Free Report) is slated to report third-quarter 2024 results on Oct. 24, after market close. It has an Earnings ESP of +1.04% and a Zacks Rank of 3 at present.
The Zacks Consensus Estimate for earnings is pegged at $3.27 per share. The consensus estimate for sales is pegged at $5.31 billion, which indicates year-over-year growth of 8%.
CurtissWright (CW - Free Report) is expected to report third-quarter results on Oct. 30, after market close. It has an Earnings ESP of +0.54% and a Zacks Rank of 2 at present.
The Zacks Consensus Estimate for CW’s earnings is pegged at $2.70 per share. The consensus estimate for sales is pegged at $756 million, which implies year-over-year growth of 4.4%.
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Leidos Holdings to Report Q3 Earnings: What's in the Cards?
Leidos Holdings, Inc. (LDOS - Free Report) is scheduled to release third-quarter 2024 results on Oct. 29, before market open.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
The company delivered an earnings surprise of 16.37% in the last reported quarter. Moreover, the stock boasts a four-quarter average earnings surprise of 23.49%.
Let’s discuss the factors that are likely to be reflected in the upcoming quarterly results.
Key Factors to Consider
LDOS currently generates revenues from its four segments — National Security and Digital, Health & Civil, Commercial & International and Defense Systems.
Organic growth, driven by increased sales volume from the Sentinel and DES programs, is likely to have bolstered the National Security and Digital unit’s top-line performance in the to-be-reported quarter. Solid volume growth from several contracted research and development efforts is also expected to favorably contribute to this unit’s quarterly results.
Leidos Holdings, Inc. Price and EPS Surprise
Leidos Holdings, Inc. price-eps-surprise | Leidos Holdings, Inc. Quote
Solid sales volume from the managed health services business, along with write-ups on certain programs, must have added an impetus to the Health & Civil unit’s third-quarter top line.
Increased deliveries of security products and higher sales volumes from its commercial energy as well as Australian businesses can be expected to have boosted LDOS’ Commercial & International unit’s revenues.
On the other hand, increased sales volume from prior contract wins might have bolstered the Defense Systems unit’s revenues.
The expected strong sales performance from most LDOS segments must have aided the company’s overall top line in the quarter.
Strong top-line expectations and disciplined cost management initiatives are likely to have boosted the company’s bottom-line performance. Also, with the company transitioning from development to production on some key programs of its Defense System unit, an improved operating margin (from this unit in particular) is expected to have aided its earnings growth.
However, the unfavorable impact of write-downs on certain programs within the company’s UK operations might have hurt LDOS’ overall earnings in the soon-to-be-reported quarter.
Q3 Estimates
The Zacks Consensus Estimate for revenues is pegged at $4.04 billion, indicating an increase of 3.2% from the year-ago level.
The Zacks Consensus Estimate for earnings is pegged at $1.96 per share, indicating a decline of 3.5% from the bottom line recorded a year ago.
Backlog Projections Suggest Growth
Our model expects Leidos’ backlog to decline 13.5% year over year to $32.89 billion.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for LDOS this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is the case here, as you will see below.
Earnings ESP: Leidos has an Earnings ESP of +2.78%. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Zacks Rank: LDOS currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Other Stocks to Consider
Below we have mentioned a few other players from the same sector that have the right combination of elements to beat on earnings this reporting cycle.
Northrop Grumman (NOC - Free Report) is set to report third-quarter earnings on Oct. 24, before market open. It has an Earnings ESP of +1.13% and a Zacks Rank of 3 at present.
The Zacks Consensus Estimate for earnings is pegged at $6.07 per share. The consensus estimate for sales is pegged at $10.23 billion, which suggests a year-over-year improvement of 4.6%.
L3Harris Technologies, Inc. (LHX - Free Report) is slated to report third-quarter 2024 results on Oct. 24, after market close. It has an Earnings ESP of +1.04% and a Zacks Rank of 3 at present.
The Zacks Consensus Estimate for earnings is pegged at $3.27 per share. The consensus estimate for sales is pegged at $5.31 billion, which indicates year-over-year growth of 8%.
CurtissWright (CW - Free Report) is expected to report third-quarter results on Oct. 30, after market close. It has an Earnings ESP of +0.54% and a Zacks Rank of 2 at present.
The Zacks Consensus Estimate for CW’s earnings is pegged at $2.70 per share. The consensus estimate for sales is pegged at $756 million, which implies year-over-year growth of 4.4%.