What Happened?
Shares of government consulting firm Booz Allen Hamilton (NYSE: BAH) fell 9.7% in the afternoon session after the company reported third-quarter 2025 results that missed revenue expectations and showed a steep drop in year-over-year profitability.
The company's revenue for the quarter came in at $2.89 billion, an 8.1% decline from the previous year and below the analyst consensus of $2.97 billion. While its GAAP earnings per share of $1.42 met expectations, it represented a significant drop from the $3.03 reported in the same quarter last year. Profitability was a key concern as the operating margin contracted sharply to 9.8% from 17.4% a year ago, signaling decreased efficiency. The combination of a top-line miss and deteriorating margins led to a negative reaction from investors.
The shares closed the day at $91.40, down 8.9% from previous close.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Booz Allen Hamilton? Access our full analysis report here.
What Is The Market Telling Us
Booz Allen Hamilton’s shares are not very volatile and have only had 9 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 5 months ago when the stock dropped 15% on the news that the company reported weak first quarter 2025 result: Revenue and EBITDA both missed. The shortfall came from slow contract signings, with the book-to-bill ratio slumping to 0.71x, showing the firm added less work than it delivered. Looking ahead, the company's full-year revenue guidance missed and its full-year EPS guidance fell short of Wall Street's estimates. Overall, this quarter could have been better.
Booz Allen Hamilton is down 28.8% since the beginning of the year, and at $91.27 per share, it is trading 50.9% below its 52-week high of $186 from October 2024. Investors who bought $1,000 worth of Booz Allen Hamilton’s shares 5 years ago would now be looking at an investment worth $1,172.
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