Executive Mosaic’s GovCon Index recovered from Thursday’s dip, advancing 1.39% to $5,640.35, its highest close ever. The S&P 500 (+0.38%) and Nasdaq Composite (+0.09%) posted new all-time highs, while the Dow Jones Industrial Average (+0.59%) added nearly 260 points.
GCI regains momentum
The GovCon Index regained momentum Friday. Kratos Defense & Security Solutions (Nasdaq: KTOS) showed the way, leading 22 gainers with +9.03%. Palantir Technologies (NYSE: PLTR) and Booz Allen Hamilton (NYSE: BAH) rose more than 4%. However, Fluor Corporation (NYSE: FLR), the worst performer, tanked -13.58%.
Kratos presented its Q3 2024 results that showed an 8.7% organic revenue growth due to higher drone production. Total revenue for the quarter increased 0.5% to $275.9 from a year ago, while net income reached $3.2 million compared to the $1.6 million net loss in Q3 2023.
Eric DeMarco, president and CEO of Kratos, said the company continues to make internally funded investments. It manufactures 165 jet drones a year but is well-positioned to increase production to 400 soon. Management increased the full-year revenue guidance range to between $1.12 billion and $1.15 billion.
Fluor reported a lower-than-expected revenue growth and a significant drop in profit in Q3 2024. In the three months ended Sept. 30, 2024, revenue increased 3.31% year-over-year to $4.09 billion, while net earnings declined 86.2% to $25 million compared to Q3 2023. However, the total backlog increased 20.44 % to $31.3 billion from a year ago.
Palantir Technologies popped 4.49% on news of its team up with AI public benefit startup Anthropic and Amazon Web Services. The collaboration will provide U.S. intelligence and defense agencies access to AI models in Anthropic’s Claude.
Also, on Friday, the US Navy awarded Textron Systems, a business segment of Textron (NYSE: TXT), a $ 394.3 million fixed-price incentive, firm-target, cost-plus-fixed-fee modification to definitize a previously awarded letter contract to construct nine Ship to Shore Connector Landing Craft Air Cushion 100-class craft.
Earnings season update
Around 91% of S&P 500 companies have reported actual results for their latest quarters. According to FactSet, the actual EPS of 75% was above investor estimates. The companies in the healthcare sector contributed the most to the earnings growth rate during the period. Moreover, the broader market index is on track to register a fifth-straight quarter of earnings growth.
Market Summary
| Index | Price | Net Change | % Change |
|---|---|---|---|
| GovCon Index Daily Average | 5,640.35 | 78.18 | 1.39% |
| Dow Jones Industrial Average | 43,988.99 | 259.65 | 0.59% |
| S&P 500 | 5,995.54 | 22.44 | 0.38% |
| NASDAQ | 19,286.78 | 17.32 | 0.09% |
Top 5 GovCon Index Daily Percentage Performers
| Symbol | Price | Net Change | % Change |
|---|---|---|---|
| KTOS | 25.97 | 2.15 | 9.03% |
| PLTR | 58.39 | 2.51 | 4.49% |
| BAH | 183.5 | 7.70 | 4.38% |
| LDOS | 198.42 | 5.79 | 3.01% |
| RTX | 123.55 | 3.47 | 2.89% |
Top 5 GovCon Index Daily Net Performers
| Symbol | Price | Net Change | % Change |
|---|---|---|---|
| LMT | 564.56 | 12.72 | 2.31% |
| CACI | 568.29 | 8.62 | 1.54% |
| CW | 385.84 | 8.57 | 2.27% |
| NOC | 528.99 | 8.41 | 1.62% |
| BAH | 183.5 | 7.70 | 4.38% |
Top 5 GovCon Index Daily Percentage Decliners
| Symbol | Price | Net Change | % Change |
|---|---|---|---|
| FLR | 50.93 | -8.00 | -13.58% |
| ACN | 355.53 | -5.18 | -1.44% |
| TTEK | 46.81 | -0.65 | -1.37% |
| GIB | 111.15 | -1.37 | -1.22% |
| BAESY | 71.66 | -0.30 | -0.42% |
