SAIC - Science Applications Q2 results exceed expectations; raises FY guidance

• Science Applications ( NYSE: SAIC ) Q2 shows topline revenue about flat at $1.83B, beats consensus by $10M.
• Net bookings of $2.1B resulting in a book-to-bill of 1.1x in the quarter and 1.0x TTM
• Operating income as a percentage of revenues decreased from the comparable prior year period primarily due to lower net favorable changes in contract estimates, higher accelerated amortization on certain off-market liability contracts during the prior year period.
• Adjusted EBITDA as a percentage of revenues for the quarter decreased to 9.1% from 10.1%.
• Cash flows provided by operating activities were $141M, an increase of $49M.
• During the quarter, company deployed $89M of capital, consisting of $62M of plan share repurchases, $20M in cash dividends, and $7M of capital expenditures.
• FY 2023 Guidance : The company expects revenue from the prior range of  $7.43B -$7.55B  to $7.50B-$7.55B vs consensus of $7.51B ; adjusted diluted EPS from the prior range of $6.90- $7.20 to $7.00-$7.20 vs consensus of $7.04,; free flow of $500M-$530M and adjusted EBITDA margin of ~8.9%.
• GAAP EPS of $1.75 beats consensus by $0.55.
• Quant rating of Hold on the stock, with lowest factor grades given to growth; sell-side rating of Buy with 3.50 score and an average price target of $102.37.
• Contributor writes: ' SAIC Doesn't Look Cheap But The Business Outlook Looks Compelling '; ' Science Applications International: A Stable Business With A Fair Valuation '

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