Jefferies has upgraded CACI International Inc from Hold to Buy and raised its price target to $725, implying nearly 17% upside from last Friday's closing price.
Jefferies analyst Sheila Kahyaoglu said in a research note: "After a decade of positioning, CACI continues to create value for customers and investors, reflected in high-single-digit organic growth, while margins have broken through the 10%-12% range that has capped mainstream prime contractors and IT peers."
The analyst said CACI's shift toward technology-focused national security programs has delivered faster growth and higher margins than many traditional defense contractors and government IT services firms.
The aerospace and defense company has raised its fiscal 2027 revenue guidance to $10.7 billion-$10.9 billion, with current expectations for organic growth of approximately 7%-9%.
The analyst believes CACI's steadily increasing portfolio of technology-oriented, outcome-driven contracts will support further margin expansion.
Kahyaoglu wrote in the research note: "CACI has moved beyond the traditional prime contractor and IT services lanes, carving out a unique differentiated path: roughly 8% three-year organic compound growth, above the peer average of 7%; margin improvement ranks among the top of the industry, with a cumulative 210 basis point increase over three years, versus a peer average of just 145 basis points."
Comments