What Happened?
Shares of infrastructure and defense services provider Parsons (NYSE: PSN) jumped 6.9% in the morning session after the company announced it won a $13 million government task order and received a price target increase from an analyst at Baird.
The new task order, awarded by the National Nuclear Security Administration (NNSA), involved delivering support for counter-nuclear smuggling systems to 18 countries in the Indo-Pacific region. This contract represented new work for Parsons and aimed to bolster national security by preventing the trafficking of radioactive and nuclear materials. Adding to the positive momentum, Baird analyst Andrew Wittmann maintained his "Outperform" rating on the stock and lifted the price target to $100 from $92, signaling renewed confidence in the company's financial prospects.
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What Is The Market Telling Us
Parsons’s shares are not very volatile and have only had 8 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 7 months ago when the stock dropped 11.1% on the news that the company reported disappointing fourth quarter earnings: its revenue, EPS, and EBITDA fell short of Wall Street's estimates along with its full-year revenue and EBITDA guidance. Parsons beat analysts' backlog expectations this quarter, but the weaker outlook implies the conversion of its backlog into sales will take longer than anticipated. Overall, this was a tough quarter.
Parsons is down 9.9% since the beginning of the year, and at $81.55 per share, it is trading 28% below its 52-week high of $113.31 from November 2024. Investors who bought $1,000 worth of Parsons’s shares 5 years ago would now be looking at an investment worth $2,304.
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