Core Viewpoint - Leidos (LDOS) is expected to report quarterly earnings of $2.57 per share, an increase of 8.4% year-over-year, while revenues are forecasted to decline by 2.6% to $4.25 billion [1] Earnings Estimates - Revisions to earnings estimates are crucial indicators for predicting investor actions regarding the stock, with empirical research showing a strong correlation between earnings estimate trends and short-term stock performance [2] Revenue Projections - Analysts forecast 'Revenues- Health & Civil' to reach $1.26 billion, indicating a year-over-year decrease of 4.8% [3] - 'Revenues- National Security and Digital' are projected to be $1.90 billion, reflecting a slight increase of 0.5% year-over-year [4] - 'Revenues- Commercial & International' are expected to be $568.93 million, down 5.8% from the prior-year quarter [4] - 'Revenues- Defense Systems' are estimated at $527.48 million, a decrease of 2.1% from the year-ago quarter [4] Operating Income Estimates - The consensus estimate for 'Non-GAAP operating income (loss)- Defense Systems' is $47.23 million, compared to $19.00 million from the previous year [5] - 'Operating income (loss)- National Security & Digital' is expected to be $180.05 million, up from $175.00 million in the same quarter last year [5] - 'Non-GAAP operating income (loss)- Health & Civil' is projected at $273.68 million, down from $287.00 million year-over-year [6] - 'Non-GAAP operating income (loss)- Commercial & International' is estimated at $44.62 million, compared to $48.00 million last year [7] - 'Operating income (loss)- Health & Civil' is expected to be $270.49 million, down from $279.00 million year-over-year [7] - 'Operating income (loss)- Commercial & International' is projected at $40.48 million, slightly up from $40.00 million in the same quarter last year [8] Stock Performance - Shares of Leidos have shown a return of -0.6% over the past month, compared to a -0.3% change in the Zacks S&P 500 composite [8] - Leidos holds a Zacks Rank 3 (Hold), indicating it is expected to mirror overall market performance in the near future [8]

Core Viewpoint - Leidos will participate in the Citi 2026 Global Industrial Tech and Mobility Conference, highlighting its role in the industry and providing insights into its operations and future strategies [1]. Company Overview - Leidos is a leader in industry and technology, serving both government and commercial customers with innovative digital and mission solutions [1]. - The company is headquartered in Reston, Virginia, and employs approximately 47,000 people globally [1]. - For the fiscal year ending January 3, 2025, Leidos reported annual revenues of approximately $16.7 billion [1]. Event Details - The conference will take place in Miami, Florida, with CEO Tom Bell participating in a "fireside chat" on February 18, 2026, at 1:00 p.m. ET [1]. - A live audio webcast of the event will be available on the Leidos Investor Relations website, with a replay accessible for 30 days post-event [1].

Core Insights - Leidos is modernizing IT operations for the Compartmented Enterprise Services Office (CESO) within the Defense Information Systems Agency (DISA) to enhance information sharing across the Department of War and the intelligence community [1][2] Group 1: Contract Details - The contract awarded to Leidos is valued at $142 million, focusing on integrated engineering, software development, operations, and cybersecurity services to optimize CESO's secure web applications [2] - The modernization includes scalable, AI-driven capabilities aimed at streamlining operations, improving secure information access, and advancing Zero Trust compliance [2] Group 2: Strategic Importance - This effort is designed to enhance decision-making, user experience, and mission readiness, thereby strengthening the digital backbone that supports national defense and intelligence operations [3] - Leidos' role is critical in operating, sustaining, and defending the Department of War's most vital networks, supporting U.S. defense missions globally [3] Group 3: Company Overview - Leidos is a leader in industry and technology, serving government and commercial customers with innovative digital and mission solutions, reporting annual revenues of approximately $16.7 billion for the fiscal year ended January 3, 2025 [5]

Core Insights - Leidos and RegScale are collaborating to enhance digital security for federal agencies, particularly the Department of War, by integrating Leidos' UpHold Armor with RegScale's Continuous Controls Monitoring (CCM) platform [1][2] Group 1: Partnership and Objectives - The partnership aims to automate security processes, strengthen cyber defenses, reduce operational risks, and allow federal agencies to focus on their primary missions [2][4] - The initial deployment of the integrated solution will support the U.S. Air Force and other federal organizations in modernizing their cybersecurity operations [2][3] Group 2: Technology and Benefits - UpHold Armor incorporates automated risk management into daily operations for both modern and legacy systems, while RegScale's CCM platform continuously monitors security controls and collects necessary compliance evidence [3][4] - This collaboration allows agencies to transition from periodic audits to continuous compliance, improving security visibility and reducing the complexity and cost associated with audits [4][7] Group 3: Strategic Focus - This initiative is part of Leidos' NorthStar 2030 strategy, which emphasizes digital modernization [5] - Leidos reported annual revenues of approximately $16.7 billion for the fiscal year ending January 3, 2025, indicating a strong financial position to support such initiatives [6]

Core Insights - Trustible and Leidos are collaborating to redefine AI governance through automation, aiming to reduce the time required for governance processes from weeks to hours or even minutes while ensuring oversight and control [1][5][6] AI Governance Overview - AI governance involves establishing guardrails for AI usage, ensuring systems are reviewed, approved, and monitored to understand their functionality, risks, and readiness for deployment [2] - The goal is to ensure responsible AI deployment with transparency, accountability, and alignment to legal and ethical standards [2] Collaboration Details - The partnership leverages Leidos' extensive experience in AI deployment and Trustible's automated governance platform to facilitate AI adoption while managing associated risks [3][4] - The collaboration aims to operationalize governance through automation, allowing agencies to transition from policy to practice more efficiently [4] Automation Impact - In a proof-of-concept, the collaboration demonstrated that automated governance can significantly reduce barriers to AI deployment, compressing the initial governance intake process from weeks to hours or minutes based on system complexity [5] - This automation is expected to streamline governance workflows while maintaining necessary rigor, accountability, and transparency in mission-critical environments [5][6] Future Outlook - With ongoing development of advanced agentic capabilities, the collaboration anticipates further compression of governance timelines, enabling a focus on outcomes rather than processes [6] - The joint approach is designed to support AI adoption across various sectors, including civilian, defense, and intelligence, by embedding governance directly into AI workflows [7] Integration and Commitment - Leidos has integrated Trustible's platform into its enterprise governance framework, reinforcing its commitment to delivering secure and accountable AI systems at scale [8]

Core Insights - Leidos is acquiring ENTRUST Solutions Group for $2.4 billion in an all-cash deal to enhance its energy business, which is described as a "hidden gem" with double-digit growth and margins [2][5][9] - The acquisition aligns with Leidos' "North Star 2030" strategy, focusing on growth in power and energy infrastructure engineering services [3][4] - The deal is expected to close in Q2 2026 and will be accretive to adjusted EPS in 2027, with significant synergies anticipated [4][11][12] Company Overview - Leidos is a technology and engineering company providing services to government and commercial customers, with a focus on national security, defense, and civil government markets [17] - The company has a strong emphasis on systems integration, engineering, cybersecurity, and data analytics [17] Acquisition Details - The acquisition will add approximately 3,100 employees to Leidos and position it as a top-4 U.S. power and transmission & distribution engineering provider [5][8] - ENTRUST is expected to contribute about $650 million in annual revenue, implying a purchase multiple of approximately 16x next-12-month EBITDA [4][9][10] - Leidos plans to finance the acquisition through a combination of bonds, cash, and commercial paper, with a committed bridge facility in place [4][12] Strategic Fit - The acquisition is seen as creating an "integrated platform" for engineering and program management across various energy sectors, enhancing cross-selling opportunities [6][8] - Leidos aims to leverage ENTRUST's capabilities to increase its exposure to electric power generation and gas markets [6][14] Market Context - The deal is positioned within broader trends in energy infrastructure investment, including rising electricity demand and a focus on grid reliability and security [14] - Leidos expects to enhance its cybersecurity capabilities in the utility market as part of the expanded platform [14] Cultural and Operational Considerations - Due diligence indicated a strong cultural fit between Leidos and ENTRUST, with similar organizational structures and compensation levels [7] - The integration will be managed by the same leadership team that successfully completed a prior acquisition, focusing on technology application rather than workforce reduction [16]

Group 1 - Leidos Holdings, Inc. (LDOS) has agreed to acquire ENTRUST Solutions Group for nearly $2.4 billion, with the transaction expected to close by the end of Q2 2026 [1][9]. - The acquisition will significantly expand Leidos' utility infrastructure footprint, effectively doubling its $600 million energy infrastructure engineering business and enhancing its role in grid modernization [2][9]. - The deal aligns with Leidos' NorthStar 2030 strategy, focusing on secure and resilient energy infrastructure, supported by an anticipated $1 trillion in U.S. utility investment over the next decade [3]. Group 2 - The acquisition is expected to improve Leidos' competitive positioning in a growing market, driven by rising demand for grid reliability, renewable integration, and climate resilience, supporting long-term revenue growth and earnings durability [4]. - The computer and technology sector has seen a surge in mergers and acquisitions, driven by rapid innovation and competition, allowing companies to scale operations and enhance capabilities [5][6]. - Other recent acquisitions in the sector include IonQ's agreement to acquire SkyWater Technology for nearly $1.8 billion, aimed at accelerating its quantum computing roadmap [6]. Group 3 - Leidos' stock has gained 17.3% over the past six months, contrasting with a 10.1% decline in the industry [11]. - Currently, Leidos holds a Zacks Rank of 3 (Hold) [12].

Company Overview - ENTRUST Solutions Group is a leading consulting and engineering services platform serving the utility and infrastructure end markets with over 3,100 professionals across 40+ locations in North America [2][7] - The company provides consulting, design, and engineering services aimed at maintaining and upgrading aging utility infrastructure in the United States [2][7] - Over the past six years, ENTRUST has significantly expanded its geographic reach, service capabilities, and customer base through organic growth, strategic acquisitions, and enhanced operational infrastructure [7] Investment Details - Neuberger Berman Capital Solutions, along with funds managed by Neuberger Berman Private Markets, announced the exit of its minority investment in ENTRUST through a sale to Leidos for approximately $2.4 billion [1] - Neuberger initially acquired a significant minority stake in ENTRUST in August 2023 [1] - The transaction is subject to customary closing conditions and regulatory approvals, expected to close in the second quarter of 2026 [4] Strategic Partnerships - Neuberger Berman has played a vital role in supporting ENTRUST's strategic investments and team assembly, positioning the company for long-term success [3] - Leidos has retained Citi as financial advisor, Davis Polk & Wardwell LLP as legal advisor, and PwC as accounting advisor for the transaction [3] - ENTRUST, Kohlberg, and Neuberger have engaged Houlihan Lokey and Perella Weinberg Partners as financial advisors, Ropes & Gray as legal advisor, and KPMG as accounting advisor [4]

Core Insights - Leidos Holdings, Inc. (LDOS) has been actively participating in the 2025 rally in defense stocks, indicating a positive market trend for the company and the sector [1] - The company started 2026 with a strategic acquisition, suggesting a proactive approach to growth and market positioning [1] Group 1 - Leidos Holdings had a solid but not particularly inspiring performance in the previous year, which sets the stage for its current activities [1] - The company is part of a broader investment group that focuses on capitalizing on significant corporate events such as IPOs, mergers & acquisitions, and earnings reports [1]

Core Viewpoint - Leidos has agreed to acquire ENTRUST Solutions Group for approximately $2.4 billion in cash, with the deal expected to close by the end of Q2 2026, pending regulatory approvals [1][2]. Group 1: Acquisition Details - The acquisition will be funded through a combination of new debt, available cash, and commercial paper [1]. - ENTRUST was initially acquired by Kohlberg in 2019, and this sale marks an exit for the private equity firm [1]. Group 2: Company Overview - ENTRUST employs over 3,000 professionals across 40 locations in North America, providing consulting, design, and engineering services primarily to gas and electric utilities [2]. - The integration of ENTRUST is expected to double the scale of Leidos' existing $600 million energy infrastructure engineering business [2]. Group 3: Strategic Implications - The acquisition is anticipated to enhance Leidos' access to utility sector markets and expand its client base among utilities [3]. - This move aligns with Leidos' NorthStar 2030 strategy, which emphasizes engineering and technology for secure energy infrastructure [3]. Group 4: Leadership Perspective - ENTRUST CEO Adam Biggam highlighted that the merger will unite expertise in power and energy engineering, creating a robust infrastructure platform with over 5,500 energy professionals [4].