What Happened?
Shares of government IT services provider Science Applications International Corporation (NASDAQ: SAIC) jumped 4.9% in the morning session after positive sentiment swept through the defense technology sector following a competitor's major contract win, which was supported by a notable insider stock purchase.
The broader interest in government IT stocks was sparked after peer company Parsons announced a new $392 million federal contract. This news led investors to look at other companies in the space. SAIC was noted as a company that often benefits when investors seek exposure to federal IT modernization, cloud migration, and enterprise services. Adding to the positive mood, an Executive Vice President at SAIC purchased company shares, a move often seen as a signal of confidence from within the company.
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What Is The Market Telling Us
SAIC’s shares are not very volatile and have only had 9 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was about 1 month ago when the stock gained 16.6% on the news that the company reported third-quarter results that beat profit estimates and raised its full-year guidance.
While revenue for the quarter was in line with Wall Street's expectations at $1.87 billion, it marked a 5.6% decrease year-over-year. However, investors focused on the company's strong profitability. SAIC posted adjusted earnings of $2.58 per share, significantly surpassing analyst estimates by over 20%. Adjusted EBITDA, a measure of core profitability, also came in 5% ahead of consensus at $185 million. Building on this strong performance, SAIC lifted its adjusted earnings per share forecast for the full year to a midpoint of $9.90.
SAIC is up 5.7% since the beginning of the year, but at $107.02 per share, it is still trading 13.3% below its 52-week high of $123.41 from May 2025. Investors who bought $1,000 worth of SAIC’s shares 5 years ago would now be looking at an investment worth $1,148.
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