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Booz Allen (BAH) Stock Rallies 22.3% in a Year: Here's Why

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Shares of Booz Allen Hamilton Holding Corporation (BAH - Free Report) have gained 22.3% over the past year, outperforming 11.3% growth of the industry it belongs to.

 

Let’s delve into factors that have contributed to the company’s price performance.

Consecutive Earnings & Revenue Beat

Booz Allen came up with better-than-expected earnings and revenue performance in five of the past six quarters. While the company’s bottom line benefited from top-line growth, strong contract-level performance and operational management, revenues were aided by sustained demand for the company’s services and solutions, and rise in headcount to meet that demand.

Innovative Approaches

Booz Allen is focusing on areas such as artificial intelligence, advanced engineering, directed energy and modern digital platforms to drive innovation. It is developing mechanics and infrastructure for new and disruptive business models to enhance service quality and client satisfaction. Transformative solutions created by such efforts are expected to significantly enhance future revenue opportunities.

Differentiated Business Model

Booz Allen has developed its solutions business in a way that it creates differentiated business models and sales channels, increases client acquisition and enhances revenue opportunities. The company also differentiates itself in the talent market so as to attract and retain quality talent from diverse disciplines. These initiatives have enhanced its ability to bring a variety of offerings, which have helped it win highly technical, mission-critical work for federal government business. All these ensure long-term growth.

Zacks Rank and Stocks to Consider

Booz Allen Hamilton currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader Zacks Business Services sector are ManpowerGroup (MAN - Free Report) , Insperity (NSP - Free Report) and BG Staffing (BGSF - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The long-term expected earnings per share (three to five years) growth rate for ManpowerGroup, Insperity and BG Staffing is 3.5%, 15% and 20%, respectively.

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