2024-04-02 11:50:10 ET
Summary
- The article discusses Leidos, which seems more of an IT company operating in the defense sector instead of a producer of guns and missiles.
- Its realignment puts it in a favorable position to benefit from the DoD's spending objectives in 2025.
- The company's focus is also on improving defense capabilities through the use of digital technologies and expanding internationally by doing business with allies and partners.
- A comparison with IT sector peers reveals the extent to which this industrial play is underpriced but at the same time its lower cash generation capability requires monitoring of the debt position.
- The underlying theme is to opt for stocks that play a backstage but key role in enhancing U.S. military capabilities instead of highly-publicized ones designing cutting-edge weapons.
Leidos ( LDOS ) which operates in the defense sector, has recently realigned its business into four reportable segments to focus on services like cybersecurity, analytics, and digital transformation to better serve its customer base as well as expand internationally. This thesis aims to show how this repositioning puts it in a strong posture to benefit from how the DoD (Department of Defense) spends its money....
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Leidos: Well-Positioned IT Play Operating In The Defense Space