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What's in Store for Science Applications' (SAIC) Q2 Earnings?

SAIC's (SAIC) Q2 results likely to reflect benefits from back-to-back contract wins and the acquisition of Halfaker and Associates amid ongoing supply...

This story originally appeared on Zacks

Science Applications International Corporation SAIC is scheduled to report second-quarter fiscal 2022 results on Sep 2.

- Zacks

For the fiscal second quarter, the Zacks Consensus Estimate for revenues is pegged at $1.79 billion, indicating an improvement of 1.3% from the year-ago quarter. The consensus mark for earnings stands at $1.47 per share, suggesting a decline of 9.8% from the prior-year reported number.

The company’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 16.9%.


Factors to Note

Science Applications’ second-quarter fiscal 2022 results are likely to reflect key contract wins, driven by a strong product portfolio. The company’s capability to sustain its existing contracts along with the newly-awarded ones across the customer portfolio might have acted as a tailwind. These include the U.S. Army Aviation and Missile Command contract among other Army deals.

The acquisition of Halfaker and Associates may have resulted in incremental revenues in the quarter under review. This along with its free cash flow performance might have driven SAIC’s top and bottom-line growth. Last year’s acquisition of Unisys Federal is expected to continue aiding revenue growth in this quarter as well.

Strong demand for the company’s IT modernization services, which include advanced analytics, software and app modernization, and cloud migration, may have favored the performance in the quarter to be reported.

However, the COVID-19 pandemic continued to disrupt the company’s supply-chain portfolio. This might have weighed on the top line in the quarter under review.

What Our Model Reveals

Our proven model does not conclusively predict an earnings beat for Science Applications this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.

Science Applications currently has a Zacks Rank of #2 and an Earnings ESP of -2.33%.

Stocks With Favorable Combinations

Here are some companies, which, per our model, have the right combination of elements to post an earnings beat in their upcoming releases:

Signet Jewelers SIG has an Earnings ESP of +2.28% and a Zacks Rank of 2, at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

CarMax KMX has an Earnings ESP of +1.88% and a Zacks Rank of 2 currently.

Dave & Busters Entertainment PLAY has an Earnings ESP of +21.65% and a Zacks Rank of 2 presently.

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