Core Insights - Leidos Holdings (NYSE: LDOS) has experienced a nearly 20% increase in share price since the initial buy recommendation was published, indicating strong market confidence in the company's growth and profitability [1]. Company Performance - The company continues to demonstrate robust growth and high profitability, which is a positive indicator for potential investors [1].

Core Insights - Leidos Holdings (NYSE: LDOS) has seen its shares increase by nearly 20% since the initial buy recommendation was published, indicating strong market confidence in the company's growth and profitability [1]. Company Performance - The company continues to demonstrate robust growth and high profitability, which is a positive indicator for potential investors [1].

Core Insights - Stock markets are reaching new records as investor confidence grows regarding potential Federal Reserve rate cuts due to a softening labor market and rising inflation from tariffs [1] Company Summaries - **Halozyme Therapeutics, Inc. (HALO)**: A biopharmaceutical company focused on oncology treatments and drug delivery technology. Expected earnings growth of 46.1% in 2025, with a 9.1% increase in broker ratings over the past four weeks. Currently holds a Zacks Rank 1 [7][8][10] - **Leidos Holdings, Inc. (LDOS)**: A global leader in science and technology serving defense, intelligence, civil, and health markets. Projected earnings growth of 9.2% in 2025, with a 5.6% increase in broker ratings over the past four weeks. Currently holds a Zacks Rank 2 [9][11][10] - **TransUnion (TRU)**: A leading provider of risk and information solutions. Expected earnings growth of 4.1% in 2025, with a 5% increase in broker ratings over the past four weeks. Currently holds a Zacks Rank 2 [11][12][10]

Core Insights - The article discusses the importance of a hybrid investment strategy, specifically GARP (Growth at a Reasonable Price), which combines elements of both value and growth investing to navigate market uncertainties [1][2][3] GARP Investment Strategy - GARP investing prioritizes the price/earnings growth (PEG) ratio, which relates a stock's P/E ratio to its future earnings growth rate [5][6] - A lower PEG ratio, ideally below 1, indicates both undervaluation and future growth potential [6] - The article highlights that while P/E ratios can indicate discounts, the PEG ratio adds a growth perspective, making it a more comprehensive metric for investors [6][7] Screening Criteria for GARP Investments - Successful GARP investments should meet several criteria, including: - PEG Ratio less than the industry median - P/E Ratio (using F1) less than the industry median - Zacks Rank of 1 (Strong Buy) or 2 (Buy) - Market Capitalization greater than $1 billion - Average 20-Day Volume greater than 50,000 - Percentage Change F1 Earnings Estimate Revisions greater than 5% - Value Score of less than or equal to B [8][9][10] Featured GARP Stocks - **Halozyme Therapeutics (HALO)**: A biopharmaceutical company with a discounted PEG and an expected growth rate of 31% [11][12] - **Phibro Animal Health (PAHC)**: A diversified animal health company with a discounted PEG and P/E, and a long-term growth rate of 15% [13][14] - **Leidos (LDOS)**: A global science and technology leader with a discounted PEG and P/E, and a historical growth rate of 14.6% [15][16] - **PDD Holdings Inc. (PDD)**: A multinational commerce group with a discounted PEG and P/E, and a long-term expected growth rate of 9.7% [17][18]

Core Insights - Leidos has introduced Sea Dagger, a next-generation Commando Insertion Craft designed for the Royal Navy, which combines speed, range, vehicle delivery, and modular mission systems into a single platform, setting a new standard in maritime autonomy and operational agility [1][3] Group 1: Product Development - Sea Dagger is developed under the UK Commando Force programme, aiming to deliver 24 medium surface insertion craft for deploying Commando Strike teams and other tactical platforms from long range [2] - The craft can exceed speeds of 40 knots and is a result of collaboration between Leidos Naval Architects, military experts, and the Royal Navy, leveraging over 30 years of fast-craft expertise [3] Group 2: Technological Features - Sea Dagger incorporates advanced technologies such as Trusted Mission AI, autonomous systems, and integrated weaponry, focusing on operational resilience, readiness, and maintainability [3] - The design addresses challenges faced by specialized units in coastal and shallow-water environments, combining naval architecture with high-tech sensors and command-and-control capabilities [5] Group 3: Strategic Alignment - The development of Sea Dagger aligns with AUKUS Pillar 2 maritime autonomy objectives and the UK Strategic Defence Review, enhancing the UK Commando Force's ability to respond to modern threats [4] - The initiative reflects a commitment to equipping military forces with resilient, future-ready platforms that can adapt to the complexities of modern warfare [6] Group 4: Company Overview - Leidos is a leader in industry and technology, serving government and commercial customers with innovative digital and mission solutions, reporting annual revenues of approximately $16.7 billion for the fiscal year ended January 3, 2025 [8]

Core Insights - Leidos (LDOS) is currently viewed as a more attractive investment compared to ServiceNow (NOW) for value investors due to its stronger earnings outlook and better valuation metrics [3][6]. Valuation Metrics - Leidos has a forward P/E ratio of 16.22, significantly lower than ServiceNow's forward P/E of 54.27, indicating that LDOS may be undervalued [5]. - The PEG ratio for Leidos is 2.11, while ServiceNow's PEG ratio is 2.28, suggesting that LDOS offers a better balance between price and expected earnings growth [5]. - Leidos has a P/B ratio of 4.93 compared to ServiceNow's P/B of 17.34, further highlighting the relative undervaluation of LDOS [6]. Investment Ratings - Leidos holds a Zacks Rank of 2 (Buy), indicating a positive earnings outlook, while ServiceNow has a Zacks Rank of 3 (Hold), suggesting a less favorable outlook [3][6]. - The Value grade for Leidos is B, whereas ServiceNow has received an F, reinforcing the notion that LDOS is the superior value option at this time [6].

Core Insights - Leidos Holdings, Inc. (LDOS) presents a strong investment opportunity due to rising earnings estimates, robust return on equity (ROE), a solid backlog, and consistent shareholder returns [1] Growth Outlook & Surprise History - The Zacks Consensus Estimate for LDOS' 2025 earnings per share (EPS) has increased by 2.8% to $11.07 over the past 30 days [2] - The total revenue estimate for 2025 stands at $17.15 billion, indicating a growth of 2.9% [2] - LDOS has a long-term earnings growth rate of 7.7% and has surpassed earnings estimates in the last four quarters with an average earnings surprise of 25.13% [2] Return on Equity - LDOS has a return on equity (ROE) of 33.57%, significantly higher than the industry average of 20.01%, indicating effective fund utilization [3] Solvency & Liquidity Position - The times interest earned (TIE) ratio for LDOS at the end of Q2 2025 was 10.3, suggesting the company can meet its interest obligations comfortably [4] - The current ratio was 1.62, indicating the company can meet its short-term liabilities without difficulty [4] Rising Backlog - Leidos has secured significant contract wins from the Pentagon and other U.S. allies, contributing to a backlog of $46.21 billion as of July 4, 2025, up from $41.55 billion a year earlier, enhancing revenue visibility [5][8] Return to Shareholders - Leidos has consistently increased shareholder value through dividends, currently paying a quarterly dividend of 40 cents per share, resulting in an annualized dividend of $1.60 and a dividend yield of 0.89%, surpassing the sector average of 0.61% [6] Stock Performance - Over the past six months, LDOS shares have increased by 40.4%, while the industry has seen a decline of 12.7% [9]

Company Overview - Leidos Holdings, Inc. is a global science and technology leader founded in 1969, serving defense, intelligence, civil, and health markets [11] - The company specializes in cybersecurity, data analytics, enterprise IT modernization, operations and logistics, sensors, software development, and systems engineering [11] Investment Ratings - Leidos is currently rated 2 (Buy) on the Zacks Rank, indicating a favorable investment outlook [12] - The company has a VGM Score of A, suggesting strong overall performance across value, growth, and momentum metrics [12] Performance Metrics - Leidos has a Momentum Style Score of B, with shares increasing by 9.3% over the past four weeks [12] - Five analysts have revised their earnings estimates upwards for fiscal 2025, with the Zacks Consensus Estimate rising by $0.37 to $11.07 per share [12] - The company boasts an average earnings surprise of +25.1%, indicating strong performance relative to expectations [12] Investment Considerations - With a solid Zacks Rank and top-tier Momentum and VGM Style Scores, Leidos is recommended for investors' consideration [13]

Core Viewpoint - Investors are evaluating Leidos (LDOS) and ServiceNow (NOW) for potential undervalued stock opportunities, with LDOS currently appearing as the more favorable option based on various valuation metrics [1][7]. Valuation Metrics - LDOS has a forward P/E ratio of 16.12, significantly lower than NOW's forward P/E of 50.67, indicating that LDOS may be undervalued relative to its earnings potential [5]. - The PEG ratio for LDOS is 2.10, while NOW's PEG ratio is slightly higher at 2.13, suggesting that LDOS offers a better balance between price and expected earnings growth [5]. - LDOS has a P/B ratio of 4.86 compared to NOW's P/B of 16.19, further supporting the argument that LDOS is more attractively valued [6]. Zacks Rank and Value Grades - LDOS holds a Zacks Rank of 2 (Buy), indicating a positive earnings outlook due to recent estimate revisions, while NOW has a Zacks Rank of 3 (Hold) [3]. - In terms of value grades, LDOS has a Value grade of B, whereas NOW has a Value grade of F, highlighting LDOS's stronger position in terms of value investing metrics [6]. Conclusion - Based on stronger estimate revision activity and more attractive valuation metrics, LDOS is positioned as the superior choice for value investors compared to NOW [7].

Group 1 - Leidos (LDOS) is currently outperforming its peers in the Computer and Technology sector, with a year-to-date return of 26.3% compared to the sector average of 14.3% [4] - The Zacks Rank for Leidos is 2 (Buy), indicating a positive outlook based on earnings estimates and revisions, with a 7% increase in the consensus estimate for full-year earnings over the past 90 days [3] - Leidos belongs to the Computers - IT Services industry, which has seen an average loss of 16.8% this year, further highlighting its strong performance relative to its industry [5] Group 2 - The Computer and Technology sector includes 605 individual stocks and is currently ranked 5 in the Zacks Sector Rank [2] - Another stock in the sector, Crexendo (CXDO), has also shown strong performance with a year-to-date return of 15.7% and a Zacks Rank of 2 (Buy) [4][5] - The Internet - Services industry, to which Crexendo belongs, has a year-to-date increase of 8.3% and is ranked 97 among 34 stocks [6]