AMTM Stock Forecast & Price Target

Amentum Holdings is positively viewed because its earnings quality is improving even when revenue is choppy: FY26 revenue guidance was trimmed to $13.8bn-$13.95bn, yet adjusted EBITDA guidance was raised to $1.115bn-$1.14bn, implying an 8.1% midpoint margin versus 7.9% and signaling better mix, execution, and cost discipline. The company also showed strong operating momentum with $48.2bn of backlog, $17.7bn of net bookings, a 1.1x quarterly book-to-bill, and a 1.3x LTM book-to-bill, while 2QFY26 delivered $290mn of adjusted EBITDA, $135mn of FCF, and net leverage improved to 3.0x. Its outlook is further supported by growth in Digital Solutions, margin expansion in Global Engineering Solutions, and attractive long-term optionality in nuclear, critical digital infrastructure, and space, where management expects rising demand and higher-margin work to drive future growth.

Amentum Holdings is viewed negatively because its preliminary FY27 outlook implies only ~0%-1% reported revenue growth, despite record backlog and a ~$32bn pending award pipeline, signaling a weaker growth conversion than investors expected. The muted guide reflects a ~3% NASA insourcing headwind and a ~1% drag from exiting low- and no-margin base operations work, while the company still faces concentration risk with ~80% of revenue tied to the U.S. government and defense budgets. Although 3QFY26 showed strong adjusted EPS of $0.67 versus consensus of $0.61, the prospect of only mid-single-digit growth in the remaining portfolio and the uncertainty around reconciling this with a 4%-6% long-term growth framework justify caution.