SAIC

Science Applications International($SAIC) Executives Aggressively Buy Shares Amid Government Policy Uncertainty-Driven Stock Declines

03/25/2025 20:48

Over the past several months, executives at Science Applications International Corp ($SAIC) have been consistently purchasing company stock at notable timing points, drawing investor attention. SAIC is a key IT services and technology solutions provider for the U.S. government and defense sectors, with a market capitalization of approximately $5.7 billion. The company's stock has shown significant volatility over the past nine months, with a particularly sharp decline following the announcement of the Trump administration's plan to establish a Department of Government Efficiency last November. What's noteworthy is that multiple executives have actively purchased company shares whenever the stock has experienced downturns. On November 14, 2024, SAIC's stock plummeted approximately 15% from $147 to $125, and by mid-December, it had fallen further to the $110 range. During this period, several Executive Vice Presidents (EVPs) stepped in to purchase shares. On December 11, EVP Barbara Supplee acquired 425 shares at $116.36, totaling $49,453. On December 17, EVP Srinivas Attili purchased 100 shares at $113.42, while EVP Vincent P. DiFronzo bought 150 shares at $112.59 on December 16. This pattern continued on March 25, 2025, when DiFronzo purchased an additional 597 shares at $108.85. This insider buying pattern has been consistent since the summer of 2024. On June 10, EVP Prabu Natarajan purchased 2,000 shares at $114.85, and on July 12, EVP Michelle A. O'Hara acquired 1,000 shares at $118.00. The only sale during this period was by Director Katharina McFarland, who sold 3,239 shares on January 13, 2025, which appears to be an exception to the overall buying trend. Interestingly, SAIC's financial performance has actually been improving. The October quarter results, announced on December 5, 2024, reported adjusted earnings of $2.61 per share, exceeding expectations, with revenue increasing by 4.3% to $1.98 billion. Similarly, the January quarter results, announced on March 17, 2025, showed adjusted earnings of $2.57 per share, again surpassing expectations, with revenue growing by 5.8% to $1.84 billion. Despite these improving financials, the stock price has not reflected this positive performance. This disconnect appears to be driven by uncertainties surrounding the Trump administration's new government efficiency initiatives and potential changes to defense budgets. According to reports from November 15, 2024, defense industry stocks and government contractors broadly declined following Trump's announcement of appointments to the Department of Government Efficiency. Companies like SAIC are inevitably sensitive to changes in federal government spending. However, a December 9, 2024 report suggested that the efficiency initiative led by Elon Musk might actually foster partnerships between large defense contractors and smaller technology firms. This could potentially be a positive signal for technology-focused defense contractors like SAIC. Analysts maintain a cautious outlook. As of March 2025, the average analyst rating is 'hold' with a price target of $123, approximately 10% above the current stock price. This represents a downward adjustment from the December 2024 target of $148.50. Insider buying is often interpreted as an indicator of executives' confidence in a company's long-term prospects. In SAIC's case, it's notable that multiple senior executives are investing their own funds. Particularly significant is that these purchases have concentrated during stock price declines triggered by Trump administration policy uncertainties, suggesting confidence in the company's long-term fundamentals. SAIC's recent annual revenue stands at approximately $7.48 billion, with organic growth of 3.1%. The company maintains strengths in government IT modernization, digital engineering, intelligence, and data analytics—areas where the government efficiency initiative might actually increase demand for such services. In conclusion, SAIC's insider trading pattern demonstrates executive confidence in the company's long-term outlook despite government policy uncertainties. With solid business performance and active share purchases by management, the current stock weakness may present an opportunity for long-term investors. However, short-term volatility is likely to continue until the new administration's policy direction becomes clearer.

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