CACI

Based on a comprehensive analysis of CACI International Inc., a buy recommendation is warranted for investors seeking stable, defensive growth tied to government services.

Technical Analysis: CACI exhibits strong positive momentum, significantly outperforming the market with a stable, low-volatility advance. While trading near its 52-week high, it is not yet in overbought territory, suggesting the uptrend has room to continue, albeit with potential for short-term pullbacks.

Fundamentals & Valuation: The company demonstrates solid financial health with stable revenue, modest profitability, and manageable debt. While valuation multiples like the forward P/E of 22 appear fair for its sector, the high EV/EBITDA is a point of caution, indicating expectations for strong future earnings growth that must be met.

Risk Assessment & Conclusion: CACI's low beta provides a defensive characteristic, making it less volatile than the market. Its business model, centered on government contracting, offers revenue stability. The primary risk is its current premium valuation, which requires the company to successfully execute its growth strategy. For long-term investors comfortable with this valuation, CACI represents a compelling buy for exposure to the resilient government services sector.

*This is not investment advice, for reference only.*

RockFlow Model Forecast: Three Scenarios for 2026

Of course. Here is a 12-month investment outlook for CACI International Inc. (CACI) based on the provided analysis.

**12-Month Outlook for CACI**

Catalysts: The primary growth catalyst is the robust and expanding U.S. defense and federal IT budget, which provides a steady stream of contract opportunities. CACI's strategic focus on high-demand areas like intelligence, cyber, and enterprise IT should allow it to continue gaining market share within the government services sector.

Risks: The key risk is the stock's premium valuation (notably the high EV/EBITDA), which leaves little room for execution missteps. Any disappointment in earnings growth or a reduction in government spending priorities could lead to a significant valuation contraction.

Outlook & Target: Given the strong positive momentum and defensive, stable business model, the outlook is positive. While a specific analyst target isn't provided, a reasonable 12-month price appreciation target could align with high-single-digit to low-double-digit percentage growth, contingent on the company meeting its earnings expectations and maintaining its competitive positioning.

Wall Street Consensus

Most Wall Street analysts are optimistic about CACI's 12-month outlook, with consensus target around $611.33, indicating expected upside potential.

Overall, CACI has investment potential but also faces challenges. Here are key factors to weigh before investing.

CACI Price Performance Analysis

Overall Assessment: CACI has delivered exceptionally strong performance with a robust 18.24% gain over the past three months, significantly outperforming the broader market by nearly 15 percentage points.

Short-term Performance: The stock maintains positive momentum with a 3.08% one-month increase, building on its substantial quarterly gains. This sustained upward trajectory, coupled with a low beta of 0.587, indicates the advance has been both strong and relatively stable compared to market volatility.

Current Position: Trading at $604.57, CACI sits near the top of its 52-week range ($318.60 to $632.77), approximately 96% toward the high. While this suggests the stock is not technically overbought, investors should be mindful of potential resistance near the absolute high given the significant rally and a maximum drawdown of -29.7% over the past year.

Revenue & Profitability CACI's revenue remained stable at $2.29 billion in Q1 2026, showing minimal change from the previous quarter's $2.30 billion. Profitability metrics improved slightly, with net profit margin increasing to 5.5% from 6.9% in the prior quarter, though operating margins remain relatively thin at approximately 9.3%. The company maintains consistent but modest profitability in its government contracting operations.

Financial Health The company demonstrates solid financial health with a moderate debt-to-equity ratio of 0.80 and interest coverage of 4.6x, indicating manageable debt levels. Current and quick ratios of 1.54 and 1.43 respectively show adequate short-term liquidity, though the cash ratio of 0.11 suggests limited immediate cash reserves relative to current liabilities.

Operational Efficiency CACI's operational efficiency appears mixed, with ROE at 3.1% reflecting modest returns to shareholders. The asset turnover of 0.26 indicates relatively low revenue generation per dollar of assets, which is typical for capital-intensive government services businesses. However, strong inventory turnover of 14.8x and efficient cash conversion cycle of 46 days demonstrate effective working capital management.

Valuation Level: CACI's current valuation metrics present a mixed picture. The trailing PE of 34.25 appears elevated, though the more indicative forward PE of approximately 22 suggests some moderation in valuation expectations. However, the alarmingly high EV/EBITDA of 52.7 and negative PEG ratio are significant concerns, indicating potential overvaluation based on cash flow and growth-adjusted metrics. The PB ratio of 3.43 appears reasonable for a services-focused business.

Peer Comparison: Without available industry average data, a direct comparative analysis cannot be conducted. However, CACI's valuation metrics should be contextualized against comparable defense services and IT consulting firms to determine relative positioning. The elevated multiples suggest the market is pricing in strong future performance, which would require validation against peer group benchmarks for proper assessment.

Volatility risk appears moderate given CACI's beta of 0.587, indicating less sensitivity to broader market movements than the overall market. However, the one-year maximum drawdown of -29.7% demonstrates significant downside volatility during periods of market stress, suggesting investors should still anticipate substantial price declines despite the low beta reading.

The notable absence of short interest reflects minimal active bearish sentiment toward the stock. While this reduces risks associated with short squeezes, investors should remain aware of other factors including potential liquidity constraints during volatile periods and company-specific risks inherent to the government contracting sector, such as contract renewals and budget uncertainties.