SAN FRANCISCO -- Shares of SAIC ( SAI) rose Tuesday after the company reaffirmed its full-year financial targets, giving investors confidence that it's weathering recent problems.

The stock was recently trading up 61 cents, over 3%, to $19.29 after management told analysts that the engineering- and information-technology-services contractor was on track to earn 83 to 88 cents a share from continuing operations for the current fiscal year, in line with prior guidance.

Analysts, on average, were expecting SAIC to earn 87 cents a share, excluding one-time items.

SAIC also reiterated its earlier annual revenue forecast of $8.7 billion to $9 billion, in line with analyst expectations. That forecast represents growth of 5% to 8.5%.

The company also expects cash flow from operations to reach at least $450 million, down from $704 million last year.

SAIC's stock has taken several hits this year since it originally issued its fiscal-year financial targets in April. The company has grappled with high employee turnover, pressure on its profit margins and the expiration of the lock-up period preventing employees from selling shares they were granted during the October 2006 initial public offering. Employees hold the majority of SAIC's shares.

One of the biggest blows came in May when Congress sharply cut the budget for a military contract that accounted for about 3% of the company's revenue. SAIC draws roughly 40% of its revenue from defense contracts.

In July, the company revealed that it had mishandled the addresses, social security numbers and other personal information of military personnel. The information was stored on an unsecured server used for a military health care contract.

But in the last quarter, the company topped analysts' revenue and earnings forecasts and management reassured investors with bullish comments on the outlook for government work, which accounts for nearly half of its revenue. SAIC is also moving forward on a GPS contract with the Air Force, a NATO missile defense contract and an IT project for the Navy.

Further bolstering its future growth plans, SAIC has about $1.1 billion in cash and recently extended a line of credit at previous terms, giving it ample firepower for the $300 million in acquisitions that management has planned. Management is targeting companies in intelligence, logistics and health care.

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