SAIC

SAIC($SAIC) Executives Buy Shares Amid Government Efficiency Concerns, Backed by Three Consecutive Quarters of Earnings Growth

03/27/2025 07:35

Executives at Science Applications International Corp ($SAIC) have been making notable insider purchases over recent months, drawing investor attention as multiple officers committed personal capital to buy company shares from late 2024 through March 2025 - particularly following a significant stock decline in November 2024. The mid-cap government contractor saw its stock plummet in mid-November 2024 following the Trump administration's announcement of a new Department of Government Efficiency. SAIC shares dropped nearly 15% in a single day, from $147.5 to $125.5 between November 13th and 14th, with further declines following. What's particularly interesting is that company insiders began stepping in to purchase shares after this steep drop. According to insider trading records, six executive vice presidents (EVPs) purchased SAIC shares between December 2024 and March 2025. Barbara Supplee acquired 425 shares for approximately $49,453 on December 11th, while Srinivas Attili purchased 100 shares for about $11,342 on December 17th. Vincent DiFronzo made two separate purchases - 150 shares on December 16th and another 597 shares on March 25th, 2025. Additionally, officer Hilary Hageman bought 100 shares for approximately $10,974 on March 26th, 2025. This pattern of insider buying was already evident in summer 2024. Prabu Natarajan made the largest single purchase, acquiring 2,000 shares for approximately $229,700 on June 10th. James Joshua Jackson and Michelle O'Hara also purchased 400 and 1,000 shares respectively. While these insider purchases were occurring, SAIC's financial performance continued to improve. In its third-quarter results announced on December 5th, 2024, the company reported adjusted earnings of $2.61 per share, exceeding both the previous year's $2.27 and analyst expectations of $2.17. Revenue increased by 4.3% to $1.98 billion. Even more impressive were the fourth-quarter results announced on March 17th, 2025. SAIC posted adjusted earnings of $2.57 per share, significantly surpassing both the previous year's $1.43 and analyst expectations of $2.08. Revenue grew by 5.8% to $1.84 billion. Following this announcement, SAIC shares surged 6% in premarket trading, with the stock reaching $111.9 on March 17th. For the full fiscal year 2025, SAIC achieved revenues of $7.48 billion, representing organic growth of 3.1% compared to the previous year. The company also secured $4.62 billion in government contract awards over the past year, demonstrating its stable foundation in government business. Wall Street analysts currently maintain a generally neutral stance on SAIC. The median price target from three analysts over the past six months is $134.00, with one firm issuing a buy rating. However, analyst assessments remain somewhat reserved due to the potential for reduced government spending under the Trump administration. SAIC currently faces challenges related to government efficiency policies and changes in defense industry budgets. According to a November 15th, 2024 report, defense stocks and government contractors declined following Trump's plans to establish a Department of Government Efficiency. General Dynamics fell 1.5% and Leidos Holdings dropped 4.4%, with SAIC experiencing similar significant declines. However, a December 9th, 2024 report suggested that Trump's efficiency drive might foster partnerships between large defense contractors and smaller technology firms, potentially creating new opportunities for companies like SAIC. The consistent buying activity by key insiders signals management's confidence in the company's long-term outlook. When executives purchase shares with their own money during periods of government policy uncertainty, it generally represents a positive signal. Furthermore, the fact that all these transactions were executed pursuant to pre-planned Rule 10b5-1 trading plans suggests these purchases were made with a long-term perspective rather than to capitalize on short-term price movements. SAIC is a leading provider of information technology, technical services, and consulting with the U.S. government as its primary customer. Founded in 1969, the company delivers solutions across national security, space, technology integration, healthcare, energy, and various other sectors to government and commercial clients. It currently employs approximately 26,000 people and is headquartered in Reston, Virginia.

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