Booz Allen (BAH): William Blair Sees Upside from Growing Influence, Attractive Valuation

Booz Allen Hamilton Holding Corp. (NYSE:BAH) is one of the best defense stocks in Goldman Sachs’ portfolio. This advanced technology company generates approximately 50% of its revenue from defense customers, including all branches of the U.S. military, the Office of the Secretary of Defense, NASA, and the Joint Staff.

On October 16, William Blair analyst Louie DiPalma reiterated his Buy rating on Booz Allen Hamilton Holding Corp. (NYSE:BAH) without assigning a price target. The analyst focused on two broad factors to underpin the company’s position within the US defense technology ecosystem. Firstly, he pointed to a recent high-profile White House dinner where the company participated along with the leading technology firms. According to the analyst, this shows that the company is no longer just a consulting firm, but it has grown its influence as a key player in advanced defense systems and software.

Secondly, he found the valuation for Booz Allen Hamilton Holding Corp. (NYSE:BAH) attractive. While the valuations of Booz Allen’s defense peers have risen substantially, the company’s valuation is currently at a five-year low, presenting an investment opportunity, according to the analyst.

Booz Allen Hamilton Holding Corp. (NYSE:BAH) provides solutions in cybersecurity, artificial intelligence, analytics, digital engineering, and mission-critical IT services for the U.S. government. The company is one of the largest contractors to the Department of Defense, intelligence agencies, and civilian federal sectors.

While we acknowledge the potential of BAH 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.

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