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Booz Allen Hamilton (BAH) Laps the Stock Market: Here's Why

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Booz Allen Hamilton (BAH - Free Report) closed at $93.02 in the latest trading session, marking a +2.75% move from the prior day. The stock exceeded the S&P 500, which registered a gain of 0.68% for the day. On the other hand, the Dow registered a gain of 1.05%, and the technology-centric Nasdaq increased by 0.33%.

The defense contractor's shares have seen an increase of 3.97% over the last month, surpassing the Business Services sector's loss of 0.53% and the S&P 500's gain of 1.8%.

Market participants will be closely following the financial results of Booz Allen Hamilton in its upcoming release. In that report, analysts expect Booz Allen Hamilton to post earnings of $1.25 per share. This would mark a year-over-year decline of 19.35%. Meanwhile, our latest consensus estimate is calling for revenue of $2.73 billion, down 6.55% from the prior-year quarter.

For the full year, the Zacks Consensus Estimates are projecting earnings of $5.67 per share and revenue of $11.38 billion, which would represent changes of -10.71% and -5.03%, respectively, from the prior year.

It's also important for investors to be aware of any recent modifications to analyst estimates for Booz Allen Hamilton. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, there's been a 0.4% fall in the Zacks Consensus EPS estimate. Right now, Booz Allen Hamilton possesses a Zacks Rank of #3 (Hold).

Digging into valuation, Booz Allen Hamilton currently has a Forward P/E ratio of 15.97. For comparison, its industry has an average Forward P/E of 19.76, which means Booz Allen Hamilton is trading at a discount to the group.

Also, we should mention that BAH has a PEG ratio of 1.6. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. BAH's industry had an average PEG ratio of 1.31 as of yesterday's close.

The Consulting Services industry is part of the Business Services sector. At present, this industry carries a Zacks Industry Rank of 42, placing it within the top 18% of over 250 industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.


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