Executive Mosaic’s GovCon Index held higher against narrow trading activity in U.S. financial markets Thursday on strong performances by CACI International (NYSE: CACI) and defense platform makers as Booz Allen Hamilton (NYSE: BAH) rallied to recoup one-half of losses from a steep fall Wednesday.
Thursday’s gain puts the GCI on pace for a weekly gain with Friday’s labor report from the Labor Department set to be a determining factor.
GovCon Index advancers outnumbered laggers by a 2-to-1 ratio Thursday and eight of the GCI’s S&P 500 stocks closed in positive with L-3 Communications (NYSE: LLL) the top net performer for companies listed in both indices.
Booz Allen was the Index’s top percentage mover and fourth-most actively traded company a day after a tumble of 3.78 percent on news that a firm employee was under federal investigation over a possible classified information theft.
Jefferies reiterated its “Buy” rating and $37 price target on Booz Allen and Raymond James upgraded the stock to “Outperform” from “Market Perform” in separate research notes to investors Thursday.
Jefferies’ statement comes nearly three months after analysts at the brokerage firm told investors Booz Allen was the best positioned company in the federal cybersecurity arena.
Other government services contractors CACI International (NYSE: CACI), KBR (NYSE: KBR) and Leidos Holdings (NYSE: LDOS) followed Booz Allen in the GCI’s top four percentage gainers with L-3 next in fifth.
CACI led all net gainers in the GCI and KBR has completed its recovery from Monday’s sharp 9.91-percent decline after the engineering services provider cut earnings guidance.
Northrop Grumman (NYSE: NOC) ended third for GCI net gainers after analysts at Baird initiated research on the defense contractor with an “Outperform” rating and $260 price target.
Baird called Northrop the large-cap defense stock with the best growth profile on expectations that revenue will climb in the mid-single digits between 2017 and 2020 on contributions from programs such as the F-35 fighter jet, B-21 Long Range Strike Bomber, Triton unmanned aerial vehicle and E-2D Hawkeye.
The Triton UAV program for the Air Force was certified for low-rate initial production in late September and Northrop subsequently received its first LRIP contract the next day for three of the surveillance drones, while the company first won the bomber contract in October 2015 and all protests against that award ended four months later.
Thursday’s notable decliners included S&P 500-listed companies Lockheed Martin (NYSE: LMT) and McKesson Corp. (NYSE: MCK), along with Vectrus (NYSE: VEC) as the latter of which is down 41.19 percent since the company reported the loss of a major U.S. Army logistics contract before Sept. 30’s market open.
U.S. stocks struggled for direction ahead of Friday’s jobs report due before the opening bell as seven sectors gained with materials the top-performing sector among seven advancers in the S&P 500 and healthcare stocks including McKesson the largest lagger.
Crude oil futures in New York settled up 1.22 percent to a four-month high of $50.44 per barrel.
Market Summary
| Index | Value | Net Change | % Change |
|---|---|---|---|
| GovCon Index | 80.707 | +0.262 | +0.326% |
| S&P 500 | 2, 160.77 | +1.04 | +0.05% |
| Dow Jones Industrial Average | 18, 268.50 | -12.53 | -0.07% |
| NASDAQ | 5, 306.85 | -9.17 | -0.17% |
| Advancing GovCon Index Issues | 19 |
| Declining GovCon Index Issues | 11 |
| Unchanged GovCon Index Issues | 0 |
Top GovCon Index Net Performers
| Symbol | Company | $ Current Price | Net Change –´ | % Change |
|---|---|---|---|---|
| CACI | CACI International | 103.78 | +2.32 | +2.29% |
| LLL | L-3 Communications * | 152.54 | +2.09 | +1.39% |
| NOC | Northrop Grumman * | 214.21 | +1.73 | +0.81% |
| HII | Huntington Ingalls Industries | 156.06 | +1.44 | +0.93% |
| RTN | Raytheon * | 138.25 | +1.12 | +0.82% |
Top GovCon Index Percentage Performers
| Symbol | Company | $ Current Price | Net Change | % Change –´ |
|---|---|---|---|---|
| BAH | Booz Allen Hamilton | 31.08 | +0.77 | +2.54% |
| CACI | CACI International | 103.78 | +2.32 | +2.29% |
| KBR | KBR | 16.18 | +0.31 | +1.95% |
| LDOS | Leidos Holdings | 42.80 | +0.63 | +1.49% |
| LLL | L-3 Communications * | 152.54 | +2.09 | +1.39% |
Lowest GovCon Index Net Performers
| Symbol | Company | $ Current Price | Net Change –¾ | % Change |
|---|---|---|---|---|
| LMT | Lockheed Martin * | 234.72 | -1.88 | -0.79% |
| MCK | McKesson Corp. * | 164.75 | -0.92 | -0.56% |
| VEC | Vectrus | 16.25 | -0.73 | -4.30% |
| CUB | Cubic Corp. | 46.42 | -0.51 | -1.09% |
| MMS | Maximus | 55.10 | -0.48 | -0.86% |
Lowest GovCon Index Percentage Performers
| Symbol | Company | $ Current Price | Net Change | % Change –¾ |
|---|---|---|---|---|
| VEC | Vectrus | 16.25 | -0.73 | -4.30% |
| EGL | Engility Holdings | 31.29 | -0.48 | -1.51% |
| CUB | Cubic Corp. | 46.42 | -0.51 | -1.09% |
| ACM | AECOM | 29.30 | -0.26 | -0.88% |
| MMS | Maximus | 55.10 | -0.48 | -0.86% |
