Parsons price target lowered to $81 from $93 at KeyBanc

KeyBanc lowered the firm’s price target on Parsons (PSN) to $81 from $93 on a normalized multiple, while keeping an Overweight rating on the shares. The firm notes shares vastly underperformed on news of being edged out in the Federal Aviation Administration BNATCS contract. It was reasonable for the stock to underperform since the consensus view was that Parsons was the strong favorite to win, but the extent of the selloff seems to indicate that investors were expecting the contract to contribute way more than KeyBanc was anticipating, the firm says. While disappointing, KeyBanc thinks the core growth algorithm of mid- to high-single-digit growth in Federal Solutions and Critical Infrastructure remains in place with several projects in the pipeline in both segments.