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Reasons to Include Leidos Stock in Your Portfolio Right Now
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Key Takeaways
Leidos' 2025 EPS estimate rose 2.8% to $11.07, with revenues expected to grow 2.9% y/y.
LDOS posted a 33.57% ROE, far surpassing the industry average of 20.01%.
Leidos' backlog climbed to $46.21B, up from $41.55B a year earlier, boosting revenue visibility.
Leidos Holdings, Inc. (LDOS - Free Report) , with rising earnings estimates, robust ROE, a solid backlog and valuable return to its shareholders, offers a great investment opportunity in the Zacks Computers IT Services industry.
Let’s focus on the reasons that make this Zacks Rank #2 (Buy) stock an attractive investment pick at the moment.
Growth Outlook & Surprise History of LDOS
The Zacks Consensus Estimate for LDOS’ 2025 earnings per share (EPS) has increased 2.8% to $11.07 in the past 30 days.
The Zacks Consensus Estimate for the company’s total revenues for 2025 stands at $17.15 billion, which indicates growth of 2.9%.
Leidos’ long-term (three to five years) earnings growth rate is 7.7%. It surpassed estimates in the last four reported quarters and delivered an average earnings surprise of 25.13%.
LDOS’ Return on Equity
Return on equity (ROE) measures how effectively a company has used its funds to generate higher returns. LDOS currently has an ROE of 33.57% compared to the industry's average of 20.01%. This suggests that the company has been utilizing its funds more effectively than its peers in the industry.
Leidos’ Solvency & Liquidity Position
Leidos’ times interest earned ratio (TIE) at the end of the second quarter of 2025 was 10.3. A TIE ratio greater than 1 suggests that the company will be able to make its interest payment obligations in the near term without difficulty.
Leidos’ current ratio at the end of the second quarter of 2025 was 1.62. A current ratio greater than 1 shows that the company is capable of meeting its future short-term liabilities without difficulty.
Rising Backlog of Leidos
Contract wins from the Pentagon and other U.S. allies for its cost-effective military technologies are one of Leidos' key sources of revenues. These contract wins help enhance the company's bookings and backlog.
Leidos had an excellent backlog of $46.21 billion as of July 4, 2025, compared with the prior-year quarter’s figure of $41.55 billion. Such significant backlog trends improve the company's revenue-generating possibilities for the following quarters ahead.
LDOS’ Return to Shareholders
Leidos has increased shareholder value by continuously paying dividends. Currently, the company’s quarterly dividend is 40 cents per share, resulting in an annualized dividend of $1.60. Its current dividend yield is 0.89%, better than its sector’s average of 0.61%.
LDOS Stock Outperforms Industry
In the past six months, LDOS shares have rallied 40.4% against the industry’s decline of 12.7%.
Telos delivered an average earnings surprise of 41.03% in the past four quarters. The Zacks Consensus Estimate for 2025 sales is pegged at $157.9 million, which indicates a year-over-year improvement of 45.8%.
Genpact’s long-term earnings growth rate is 9.2%. The Zacks Consensus Estimate for 2025 EPS is pegged at $3.52, which indicates a year-over-year improvement of 7.3%.
CDW’s long-term earnings growth rate is 6.4%. The Zacks Consensus Estimate for 2025 EPS is pegged at $9.83, which indicates a year-over-year improvement of 3.3%.
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Reasons to Include Leidos Stock in Your Portfolio Right Now
Key Takeaways
Leidos Holdings, Inc. (LDOS - Free Report) , with rising earnings estimates, robust ROE, a solid backlog and valuable return to its shareholders, offers a great investment opportunity in the Zacks Computers IT Services industry.
Let’s focus on the reasons that make this Zacks Rank #2 (Buy) stock an attractive investment pick at the moment.
Growth Outlook & Surprise History of LDOS
The Zacks Consensus Estimate for LDOS’ 2025 earnings per share (EPS) has increased 2.8% to $11.07 in the past 30 days.
The Zacks Consensus Estimate for the company’s total revenues for 2025 stands at $17.15 billion, which indicates growth of 2.9%.
Leidos’ long-term (three to five years) earnings growth rate is 7.7%. It surpassed estimates in the last four reported quarters and delivered an average earnings surprise of 25.13%.
LDOS’ Return on Equity
Return on equity (ROE) measures how effectively a company has used its funds to generate higher returns. LDOS currently has an ROE of 33.57% compared to the industry's average of 20.01%. This suggests that the company has been utilizing its funds more effectively than its peers in the industry.
Leidos’ Solvency & Liquidity Position
Leidos’ times interest earned ratio (TIE) at the end of the second quarter of 2025 was 10.3. A TIE ratio greater than 1 suggests that the company will be able to make its interest payment obligations in the near term without difficulty.
Leidos’ current ratio at the end of the second quarter of 2025 was 1.62. A current ratio greater than 1 shows that the company is capable of meeting its future short-term liabilities without difficulty.
Rising Backlog of Leidos
Contract wins from the Pentagon and other U.S. allies for its cost-effective military technologies are one of Leidos' key sources of revenues. These contract wins help enhance the company's bookings and backlog.
Leidos had an excellent backlog of $46.21 billion as of July 4, 2025, compared with the prior-year quarter’s figure of $41.55 billion. Such significant backlog trends improve the company's revenue-generating possibilities for the following quarters ahead.
LDOS’ Return to Shareholders
Leidos has increased shareholder value by continuously paying dividends. Currently, the company’s quarterly dividend is 40 cents per share, resulting in an annualized dividend of $1.60. Its current dividend yield is 0.89%, better than its sector’s average of 0.61%.
LDOS Stock Outperforms Industry
In the past six months, LDOS shares have rallied 40.4% against the industry’s decline of 12.7%.
Image Source: Zacks Investment Research
Other Stocks to Consider
A few other top-ranked stocks from the same industry are Telos Corporation (TLS - Free Report) , Genpact Limited (G - Free Report) and CDW (CDW - Free Report) , each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Telos delivered an average earnings surprise of 41.03% in the past four quarters. The Zacks Consensus Estimate for 2025 sales is pegged at $157.9 million, which indicates a year-over-year improvement of 45.8%.
Genpact’s long-term earnings growth rate is 9.2%. The Zacks Consensus Estimate for 2025 EPS is pegged at $3.52, which indicates a year-over-year improvement of 7.3%.
CDW’s long-term earnings growth rate is 6.4%. The Zacks Consensus Estimate for 2025 EPS is pegged at $9.83, which indicates a year-over-year improvement of 3.3%.