PSN - Parsons: This May Be A Hidden Gem But I Need Proof Its Growth Is Sustainable
2024-06-20 06:50:26 ET
Summary
- Parsons Corporation has shown impressive revenue growth of around 30% y/y over the last 5 quarters.
- The company's financial health is strong, with a healthy interest coverage ratio and a backlog covering almost 2 years of contract work.
- Despite a slightly expensive valuation, the company's positive outlook, fueled by government spending on defense projects, suggests potential for continued growth.
- I would like to see such performance persisting in order to be more bullish.
Introduction
I wanted to cover a company that has quietly outperformed the broad market by a large margin over the last year to see if it would be still a good time to start a position. The company in question is Parsons Corporation ( PSN ) . The company’s top-line growth has been tremendous which is showing no signs of stopping and supports the share price appreciation, however, if we look at some conservative estimates, the company is trading slightly too expensive to start a position right now. I would like to see this growth sustained going forward and see some margin expansion if I were to change my neutral position to a buy rating....
Parsons: This May Be A Hidden Gem, But I Need Proof Its Growth Is Sustainable