Infrastructure and defense services provider Parsons (NYSE: PSN) will be reporting results this Wednesday morning. Here’s what to look for.
Parsons missed analysts’ revenue expectations last quarter, reporting revenues of $1.58 billion, flat year on year. It was a disappointing quarter for the company, with full-year revenue guidance missing analysts’ expectations significantly and full-year EBITDA guidance missing analysts’ expectations significantly.
Is Parsons a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting Parsons’s revenue to be flat year on year, improving from the 10.4% decrease it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings.
Looking at Parsons’s peers in the defense contractors segment, some have already reported their Q3 results, giving us a hint as to what we can expect. RTX delivered year-on-year revenue growth of 11.1%, beating analysts’ expectations by 3.3%, and CACI reported revenues up 8.2%, falling short of estimates by 1.4%. RTX’s stock price was unchanged after the resultsand CACI’s price followed a similar reaction.
Read our full analysis of RTX’s results here and CACI’s results here.
Over the past year, investors have repeatedly shifted their focus from one macro narrative to another (AI disruption and AI capex spending to geopolitics, interest rates, and the broader health of the economy). While some of the defense contractors stocks have shown solid performance in this choppy environment, the group has generally underperformed, with share prices down 4.2% on average over the last month. Parsons is up 20.1% during the same time and is heading into earnings with an average analyst price target of $58.36 (compared to the current share price of $49.97).
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