This consultancy firm beat analysts’ EPS estimates by $0.04 last quarter and is forecasted to grow at an annual rate of more than 12% over the next five years—one of the bright spots during this pandemic.
Booz Allen Hamilton Holding Corporation (BAH)
From Dow Theory Forecast
The consultant Booz Allen Hamilton has increased its dividend every year since initiating the payout in 2012. Over the last three years, the dividend has risen at an annualized rate of 17%, yet still accounts for just 40% of earnings, leaving plenty of flexibility for additional hikes. The yield based on an indicated dividend five years ahead is 3.7%. To compute the future dividend, we assumed continued growth at the same rate seen over the last three years.
Booz Allen has grown per-share profits 22% annually over the last three years, and analysts expect growth of 13% this year, 10% next year, and 13% again in 2022. The stock’s consensus profit targets have held up better than most because of the company’s reliance on the U.S. government for 96% of its revenue.
Booz Allen Hamilton is a Buy and a Long-Term Buy.
Richard Moroney, CFA, Dow Theory Forecasts, dowtheory.com, 800-233-5922, May 11, 2020