Key Points
SAIC reported Q1 2027 financial results today.
The company exceeded analysts' expectations and raised its 2027 outlook.
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After closing at $96.17 on May 21, shares of Science Applications International (NASDAQ: SAIC) have closed higher during each subsequent market session. The trend seems poised to extend today, with the tech company specializing in digital solutions reporting strong first-quarter 2027 financial results this morning before the opening bell.
As of 11:49 a.m. ET, shares of SAIC are up 17.5%.
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A strong start to the fiscal year may just be the beginning
Beating analysts' expectations that it would post Q1 2027 revenue of $1.82 billion, SAIC reported sales of $1.9 billion. And it wasn't only at the top of the income statement where the company outperformed analysts' expectations. SAIC reported Q1 2027 adjusted earnings per share (EPS) of $3.23 -- better than the $2.28 that analysts had anticipated.
Management also espoused increasing optimism about the remainder of fiscal 2027. Whereas it had originally forecast adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $705 million to $715 million, the company now projects $720 million to $730 million. Similarly, SAIC raised its adjusted diluted EPS forecast to $9.90 to $10.10 from $9.50 to $9.70.
The outlook for revenue ($7 billion to $7.2 billion) and free cash flow (at least $600 million) remained unchanged.
Despite the stock's rise, it's still hanging on the discount rack
It's not only the company's fiscal 2027 forecast that bodes well for the company's future. SAIC reported $22.9 billion in backlog at the end of Q1 2027 -- an increase over the backlog of $22.3 billion it had at the same time last year. With SAIC shares trading at 13.6 times trailing earnings, a discount to its five-year average P/E of 16.4, today seems like a great time to click the buy button on this tech stock.
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Scott Levine has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
