Leidos Hld (LDOS) Stock Forecast & Price Target

Leidos Holdings Inc. has demonstrated robust growth, particularly within its National Security & Digital and Defense Systems segments, with national security revenues increasing by 8% year-over-year to $2.02 billion, exceeding market expectations. The company's Health & Civil segment has benefitted from rising exam volumes, enhancing margins significantly, while overall EBIT margins expanded markedly from 14.5% in 2023 to 22.5% in 2024, indicating strong operational efficiencies. Furthermore, Leidos is well-positioned to outpace federal budget growth due to its focus on lucrative sectors such as IT modernization, healthcare, and defense technology advancements.

Leidos Holdings Inc. faces a negative outlook due to projected significant declines in margins, particularly in the latter half of 2025 compared to the first half, as well as potential year-over-year declines in its higher-margin managed health services segment. The company is at risk of reduced medical exam volumes, which could further pressure margins and diminish investor sentiment in light of an increasingly challenging budget environment. Additionally, legal challenges related to major contract wins, uncertainties surrounding defense spending due to external stimulus measures, and operational risks from international engagements contribute to a precarious financial position for Leidos Holdings.