Goldman Sachs analyst Noah Poponak maintained a Hold rating on Parsons yesterday and set a price target of $83.00.
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Noah Poponak has given his Hold rating due to a combination of factors influencing Parsons Corp. The company is experiencing solid growth in its Federal business and infrastructure sectors, supported by significant government investments across various regions. However, while there is potential for margin expansion in North American infrastructure, the Federal segment’s margins are expected to remain stable with limited room for growth.
Additionally, the company’s focus on mergers and acquisitions as a primary capital allocation strategy suggests a cautious approach to organic growth. Although Parsons has a robust pipeline of new business opportunities, including potential contracts with the FAA, the mix of cost-plus and fixed-price contracts may limit immediate margin improvements. These factors collectively contribute to a balanced outlook, justifying the Hold rating.
PSN’s price has also changed moderately for the past six months – from $67.740 to $82.900, which is a 22.38% increase.