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Booz Allen's (BAH) Stock Down 2% Despite Q3 Earnings Beat
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Booz Allen Hamilton Holding Corp. (BAH - Free Report) reported mixed third-quarter fiscal 2021 results with earnings beating the Zacks Consensus Estimate but revenues missing the same.
It seems that the better-than-expected bottom line number failed to impress the market as the stock declined 2% since the earnings release on Jan 29. Over the past year, the stock has gained 6.3%, outperforming the 4% rally of the industry it belongs to.
Quarterly adjusted earnings per share of $1.04 beat the consensus mark by 13% and improved 30% on a year-over-year basis. The bottom line benefited from solid top-line growth and strong margin performance.
Revenues, Backlog & Headcount Increase Y/Y
Total revenues of $1.9 billion lagged the Zacks Consensus Estimate by 4.7% but increased 3% year over year. Revenues, excluding billable expenses, were $1.33 billion, increasing 6.2% on a year-over-year basis. Billable expenses accounted for 30.3% of revenues.
Total backlog increased 6.1% from the prior-year quarter’s reported figure to $23.3 billion. Funded backlog of $3.6 billion increased 2.8% year over year. Unfunded backlog was up 12.5% to $6 billion. Priced options went up 4.3% to $13.7 billion. Book-to-bill ratio was 0.32, down 33.3% year over year. Headcount of 27,566 increased 1.5% year over year.
Operating Results
Adjusted EBITDA amounted to $205.4 million, up 7.7% year over year. Adjusted EBITDA margin on revenues was 10.8%, up from the year-ago figure of 10.3%. Adjusted EBITDA margin on revenues, excluding billable expenses, increased to 15.5% from 15.3% in the year-ago quarter.
Balance Sheet & Cash Flow
Booz Allen Hamilton exited the quarter with cash and cash equivalents of $1.34 billion compared with $1.28 billion at the end of the prior quarter. Long-term debt (net of current portion) was $2.3 billion, flat with the prior-quarter figure. The company generated $232.9 million of net cash from operating activities. Capital expenditure was $15.9 million and free cash flow was $217 million.
The company paid out dividends worth $43 million and repurchased shares worth $27 million in the reported quarter.
Revised Fiscal 2021 Outlook
Adjusted EPS is anticipated to be in the range of $3.7-$3.85, compared with the previous guidance of $3.6-3.75. The midpoint ($3.78) of the guided range is above the Zacks Consensus Estimate of $3.77. The company’s revenue-growth projection is now at 4.8-6% range compared with the previous projection of 7-9%.
Adjusted EBITDA margin on revenues is anticipated to be in mid-to-high 10% range compared with low-to-mid 10% range projected previously. Operating cash flow is expected in the range of $625-$675 million while the previous projection was $600-$650 million.
Rollins’ (ROL - Free Report) fourth-quarter 2020 adjusted earnings of 13 cents per share came ahead of the consensus estimate as well as the year-ago figure by 18.2%. Revenues of $536.3 million beat the consensus mark by 1.7% and improved 6% year-over-year.
IHS Markit’s fourth-quarter fiscal 2020 adjusted earnings per share of 72 cents beat the Zacks Consensus Esimate by 7.5% and increased 11% on a year-over-year basis. Total revenues came in at $1.11 billion, marginally missing the consensus mark and declining 1% from the year-ago quarter on a reported basis.
Automatic Data Processing’s (ADP - Free Report) second-quarter fiscal 2021 adjusted earnings per share of $1.52 beat the consensus mark by 17.8% and were flat year over year. Total revenues of $3.69 billion beat the consensus mark by 3.2% and improved 0.7% year over year.
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Booz Allen's (BAH) Stock Down 2% Despite Q3 Earnings Beat
Booz Allen Hamilton Holding Corp. (BAH - Free Report) reported mixed third-quarter fiscal 2021 results with earnings beating the Zacks Consensus Estimate but revenues missing the same.
It seems that the better-than-expected bottom line number failed to impress the market as the stock declined 2% since the earnings release on Jan 29. Over the past year, the stock has gained 6.3%, outperforming the 4% rally of the industry it belongs to.
Quarterly adjusted earnings per share of $1.04 beat the consensus mark by 13% and improved 30% on a year-over-year basis. The bottom line benefited from solid top-line growth and strong margin performance.
Revenues, Backlog & Headcount Increase Y/Y
Total revenues of $1.9 billion lagged the Zacks Consensus Estimate by 4.7% but increased 3% year over year. Revenues, excluding billable expenses, were $1.33 billion, increasing 6.2% on a year-over-year basis. Billable expenses accounted for 30.3% of revenues.
Total backlog increased 6.1% from the prior-year quarter’s reported figure to $23.3 billion. Funded backlog of $3.6 billion increased 2.8% year over year. Unfunded backlog was up 12.5% to $6 billion. Priced options went up 4.3% to $13.7 billion. Book-to-bill ratio was 0.32, down 33.3% year over year. Headcount of 27,566 increased 1.5% year over year.
Operating Results
Adjusted EBITDA amounted to $205.4 million, up 7.7% year over year. Adjusted EBITDA margin on revenues was 10.8%, up from the year-ago figure of 10.3%. Adjusted EBITDA margin on revenues, excluding billable expenses, increased to 15.5% from 15.3% in the year-ago quarter.
Balance Sheet & Cash Flow
Booz Allen Hamilton exited the quarter with cash and cash equivalents of $1.34 billion compared with $1.28 billion at the end of the prior quarter. Long-term debt (net of current portion) was $2.3 billion, flat with the prior-quarter figure. The company generated $232.9 million of net cash from operating activities. Capital expenditure was $15.9 million and free cash flow was $217 million.
The company paid out dividends worth $43 million and repurchased shares worth $27 million in the reported quarter.
Revised Fiscal 2021 Outlook
Adjusted EPS is anticipated to be in the range of $3.7-$3.85, compared with the previous guidance of $3.6-3.75. The midpoint ($3.78) of the guided range is above the Zacks Consensus Estimate of $3.77. The company’s revenue-growth projection is now at 4.8-6% range compared with the previous projection of 7-9%.
Adjusted EBITDA margin on revenues is anticipated to be in mid-to-high 10% range compared with low-to-mid 10% range projected previously. Operating cash flow is expected in the range of $625-$675 million while the previous projection was $600-$650 million.
Booz Allen Hamilton currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Business Services Companies
Rollins’ (ROL - Free Report) fourth-quarter 2020 adjusted earnings of 13 cents per share came ahead of the consensus estimate as well as the year-ago figure by 18.2%. Revenues of $536.3 million beat the consensus mark by 1.7% and improved 6% year-over-year.
IHS Markit’s fourth-quarter fiscal 2020 adjusted earnings per share of 72 cents beat the Zacks Consensus Esimate by 7.5% and increased 11% on a year-over-year basis. Total revenues came in at $1.11 billion, marginally missing the consensus mark and declining 1% from the year-ago quarter on a reported basis.
Automatic Data Processing’s (ADP - Free Report) second-quarter fiscal 2021 adjusted earnings per share of $1.52 beat the consensus mark by 17.8% and were flat year over year. Total revenues of $3.69 billion beat the consensus mark by 3.2% and improved 0.7% year over year.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech stocks now>>