SAIC

Science Applications International ($SAIC) Executives Show Confidence Through Concentrated Insider Buying Amid Stock Decline

03/27/2025 22:11

Executives at Science Applications International Corp ($SAIC) have been consistently purchasing company shares over recent months, with a particularly notable concentration of insider buying in March 2025. The end of March alone saw four separate insider purchases, a movement that gains additional significance considering it followed a substantial decline in the company's stock price. EVP Prabu Natarajan acquired 2,000 shares worth approximately $220,000 on March 26, while on the same day, EVP Barbara Supplee purchased 360 shares valued at about $40,000. EVP Vincent DiFronzo bought 597 shares worth roughly $65,000 on March 25, and Director Milford McGuirt added 500 shares worth approximately $55,000 on March 27, demonstrating a coordinated buying pattern among leadership. SAIC is a prominent technology services provider in the U.S. defense sector, delivering technical, engineering, and enterprise IT services to major government clients including the Department of Defense, NASA, Department of State, Department of Justice, Department of Homeland Security, and various intelligence agencies. The company has a market capitalization of approximately $5.6 billion, placing it in the mid-cap category. Looking at price performance, $SAIC demonstrated steady growth through mid-November 2024, reaching a peak of $153.60 per share on November 11, 2024. However, the stock experienced a dramatic drop to $125.50 by November 14, continuing its downward trajectory to trade between $100-$110 throughout much of March 2025. What's particularly interesting is the persistent insider buying that occurred during this price decline. From June 2024 through March 2025, there were 15 insider transactions, with 14 being purchases and only one sale. Most notably, the majority of these purchases were executed by high-ranking EVP-level executives. The buying pattern that emerged from late 2024 shows EVP Prabu Natarajan purchasing 2,000 shares (approximately $230,000) in June, followed by several other executive purchases in July. When the stock price declined in December, EVPs Supplee, Attili, and DiFronzo again stepped in with consecutive purchases. This insider buying pattern correlates meaningfully with the company's financial performance. SAIC reported fourth-quarter fiscal year 2025 (ended January 31, 2025) revenue of $1.84 billion (representing 5.8% year-over-year growth) and adjusted earnings per share of $2.57, significantly exceeding analyst expectations of $2.08. For the full fiscal year 2025, the company achieved $7.48 billion in revenue with 3.1% organic growth. Following this earnings announcement on March 17, 2025, SAIC's stock jumped 6% in pre-market trading, suggesting that insiders may have anticipated the strong performance before their buying activities. The concentrated purchases at the end of March could further indicate executives' confidence in the company's continued growth prospects. However, SAIC and other defense contractors face uncertainty stemming from policy changes under the Trump administration. The November 2024 announcement of the Department of Government Efficiency creation put downward pressure on defense stocks broadly, and concerns were raised in March 2025 about the impact of Trump's 'shock and awe' policies on Virginia businesses, where many government contractors operate. Despite these external challenges, the consistent buying by SAIC executives signals internal confidence in the company's long-term growth potential and value proposition regardless of the changing external environment. The fact that multiple EVP-level executives are committing their personal capital to purchase shares suggests a positive internal outlook for the company. Investors typically interpret insider buying movements, especially 'cluster buying' involving multiple executives, as a positive signal. In SAIC's case, the steady insider purchases occurring after a 30%+ decline from peak prices may indicate that the current stock price is undervalued. The average analyst rating for the company currently stands at 'hold' with a median price target of $123.00, suggesting upside potential from current levels. Particularly encouraging factors include the company's stable client base in defense and government IT services sectors, as well as its recent above-expectation financial performance.

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