Does CACI International (CACI) have the Potential to Generate Sustainable Returns For Its Shareholders?

RS Investments, an investment management company, released its “RS Large Cap Value Strategy” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. In the second quarter, the strategy underperformed its benchmark, the Russell 1000 Value Index (the “Index”), and returned 3.55% (net) versus a return of 3.79% for the Index. The strong performance from stock selection in Health Care and Communication Services aided relative performance in the quarter, while stock selection in Consumer Discretionary and Industrials detracted. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2025.

In its second-quarter 2025 investor letter, RS Large Cap Value Strategy highlighted stocks such as CACI International Inc (NYSE:CACI). CACI International Inc (NYSE:CACI) provides expertise and technology to enterprise and mission customers in support of national security in the intelligence, defense, and federal civilian sectors. The one-month return of CACI International Inc (NYSE:CACI) was 3.90%, and its shares gained 8.12% of their value over the last 52 weeks. On August 7, 2025, CACI International Inc (NYSE:CACI) stock closed at $499.94 per share, with a market capitalization of $10.994 billion.

RS Large Cap Value Strategy stated the following regarding CACI International Inc (NYSE:CACI) in its second quarter 2025 investor letter:

"CACI International Inc (NYSE:CACI) provides information technology products and services, predominantly to the United States federal government. In its last fiscal year, the company received 74% of its revenues from the U.S. Department of Defense while another 21% of its revenues came from federal civilian institutions, including various intelligence agencies. The company currently benefits from bipartisan support for defense and security initiatives and is an important part of many mission-critical efforts. The share price has performed well recently as concerns over government efficiency efforts and possible funding cuts appear to have been overblown with respect to the capabilities and services CACI provides. We believe CACI should continue to create value for our shareholders as it executes on its customers’ existing programs while benefiting from a growing set of future opportunities."

CACI International Inc (NYSE:CACI) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 52 hedge fund portfolios held CACI International Inc (NYSE:CACI) at the end of the first quarter, compared to 48 in the previous quarter. In the fiscal third quarter of 2025, CACI International Inc (NYSE:CACI) reported a revenue of $2.2 billion, reflecting an 11.8% growth as reported, of which 5.6% is attributable to organic growth. While we acknowledge the potential of CACI International Inc (NYSE:CACI) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered CACI International Inc (NYSE:CACI) and shared the list of top software and technology stocks to buy. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.