Key Takeaways
- CACI shares rose 6% today after Jefferies upgraded the stock to Buy, and the company re-announced a Navy task order worth up to $281 million. Booz Allen jumped 7% on its own upgrade from TD Cowen.
- The Navy order is small and already in CACI’s bookings, so the upgrade is really a bet on the quarter CACI reported last week.
- CACI’s EBITDA margin hit 13.3% in the September quarter, up from 11.7% a year earlier, though organic revenue growth was just 2.1%.
- The stock already trades above its five-year average forward P/E, so CACI needs to hold its margins and deliver the faster organic growth management expects in the second half.
CACI International (CACI) shares are up 6% today after Jefferies analyst Sheila Kahyaoglu upgraded the stock to Buy from Hold and raised her target to $725 from $700. Her case: CACI’s margins have broken out of the 10% to 12% range typical of defense primes and government IT peers.
Before Monday’s open, CACI also announced a five-year U.S. Navy task order worth up to $281 million, an award it had already listed in last week’s results.
Booz Allen Hamilton (BAH) jumped 7% on its own upgrade, to Buy from Hold at TD Cowen, with a $95 target (from $77) on improving funded backlog. On Oct. 23, Booz Allen raised its adjusted EPS outlook even though revenue fell 3.9%.
TIKR Tracks 17 Analysts on CACI International. How Many Say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on CACI International, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See CACI International’s Analyst Ratings
The Navy order is the small part
Spread over five years, the Navy work comes to about $56 million a year (if it reaches full value), roughly 0.5% of the $10.7 billion to $10.9 billion CACI expects in fiscal 2027 revenue.
The bigger story is the fiscal first-quarter report from Oct. 21. Revenue rose 8.2% to $2.47 billion, with organic growth of just 2.1%. EBITDA margin reached 13.3%, up from 11.7% a year earlier.
That’s also above the 12.3% CACI reported for the year ended June 2026. TIKR’s longer series, which calculates EBITDA slightly differently, shows the margin climbing from 8.5% in fiscal 2017.
Mix explains much of it. Technology revenue grew 11.4% and now makes up 58.6% of sales.
Part of the margin was bought, though. Acquisitions supplied about 6 points of the 8.2% growth, and their costs land below EBITDA: interest rose 59% to $73.2 million and intangible amortization rose 51%, so net income grew just 4.5%.
Pricier than usual, but well short of its peak
At Friday’s close, CACI traded at about 18x forward earnings, above its five-year average of 17x but below its 23.5x peak in November 2024.
After today’s jump, it’s closer to 19x. Jefferies’ $725 target works out to roughly 21x.
The margin gains are real and earn CACI a premium. I’d be more careful about 21x. With organic growth at 2.1% and acquisition-related expenses weighing on net income, the premium depends on sustaining strong margins and delivering the organic growth acceleration management expects in the second half.
The December-quarter report in February is the test. With full-year margin guided to the high-12% range, a softer quarter there wouldn’t break the story. Organic growth stuck near 2% would.
So what is CACI stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
