Summary
Booz Allen Hamilton is facing a mix of supportive and adverse signals: an analyst firm has reiterated a Hold rating and a $98.00 price objective even as the company endures contract cancellations linked to an IRS data security breach and exhibits weaker revenue trends. Management has responded with share repurchases even as civil contract exposure and recent spending cuts create headwinds for fiscal year 2026.
Market context and valuation
Truist Securities reaffirmed a Hold rating on Booz Allen Hamilton (NYSE: BAH) and kept a $98.00 price target while the stock trades around $93.93. Data from InvestingPro cited by Truist indicates the firm may be trading below its Fair Value, despite a difficult year that included a 29.1% decline in the share price.
Treasury cancellations and financial scale
The U.S. Treasury Department has canceled all of Booz Allen’s contracts with it, a move Truist attributes to what the Treasury characterized as a "lack of protection for sensitive IRS data," according to analyst Tobey Sommer. The cancellations cover 31 contracts and correspond to roughly $4.8 million in annual revenue and $21 million in total contractual obligations. Those figures are small in relation to Booz Allen’s reported $11.41 billion in total revenue.
Link to past data leak
The Treasury Secretary’s announcement called out the tax data leak by former Booz Allen employee Charles Littlejohn, which took place from 2018 to 2020, as a factor behind the contract removals. Truist and public datasets note that the historical breach has been central to the government’s decision.
Civil contract pressures and revenue implications
These cancellations come on top of earlier headwinds. Booz Allen was listed among 10 consulting firms identified by the Department of Government Efficiency in March, and in April five of the company’s major civil technology agreements experienced significant spending reductions. Truist estimates those reductions create about a 3% headwind to Booz Allen’s overall fiscal 2026 revenues.
Truist cautions that civil-sector exposure could be a persistent source of difficulty even though the firm expects a low-20s percentage decline in fiscal year 2026. The analyst team suggests civil spending may face additional pressure as policy priorities shift toward increased defense spending.
Earnings, revenue and analyst moves
In its Q3 FY2026 results, Booz Allen posted an earnings-per-share (EPS) result of $1.77, outpacing the $1.29 consensus forecast and representing a 37.21% surprise. Revenues, however, fell short: the company reported $2.6 billion versus an expected $2.76 billion, a year-over-year decline of roughly 10%.
On the analyst front, DA Davidson raised its price target on Booz Allen to $81 while keeping a Neutral rating. Separately, Truist is cited as having increased its price target to $98, pointing to tax-related tailwinds and anticipated cost reductions as contributing factors to its view.
Balance-sheet actions and shareholder returns
InvestingPro notes that management has been active in repurchasing shares amid the operational and contractual challenges. The repurchases are presented alongside the company’s broader financial performance and the analyst commentary.
Conclusion
Truist’s Hold rating with a $98 target reflects a nuanced view: the firm recognizes valuation upside relative to current market prices while flagging civil-contract risk and near-term revenue pressure tied to recent government actions. The company’s stronger-than-expected EPS performance is tempered by revenue softness and the practical impact of contract cancellations.