The firm said it raised its rating on the management and technology consulting services provider as the company is keeping costs low and returning cash to investors.
Credit Suisse raised its price target on Booz Allen to $27 from $23.
Separately, TheStreet Ratings team rates BOOZ ALLEN HAMILTON HLDG CP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate BOOZ ALLEN HAMILTON HLDG CP (BAH) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its notable return on equity and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the IT Services industry and the overall market, BOOZ ALLEN HAMILTON HLDG CP's return on equity significantly exceeds that of both the industry average and the S&P 500.
- Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- BOOZ ALLEN HAMILTON HLDG CP's earnings per share declined by 18.9% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, BOOZ ALLEN HAMILTON HLDG CP increased its bottom line by earning $1.54 versus $1.45 in the prior year. This year, the market expects an improvement in earnings ($1.55 versus $1.54).
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 12.2%. Since the same quarter one year prior, revenues slightly dropped by 9.4%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- The debt-to-equity ratio is very high at 9.67 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Even though the debt-to-equity ratio is weak, BAH's quick ratio is somewhat strong at 1.28, demonstrating the ability to handle short-term liquidity needs.
- You can view the full analysis from the report here: BAH Ratings Report