• SAIC's stock price surged by 16% following its Q3 FY26 earnings release, showcasing impressive margin growth and a robust return on equity (ROE) of 23.75%.
• The company exceeded Q3 FY26 earnings expectations with non-GAAP earnings of $2.58 per share, indicating strong management and capital efficiency.
• Strategic reallocation of $100 million in annual spending towards high ROI areas and raised FY26 guidance reflect positive investor sentiment and a strong market position.

Science Applications International Corporation (NASDAQ:SAIC) is a prominent player in the IT services industry, providing a range of services to government and commercial clients. On December 8, 2025, UBS adjusted its rating for SAIC to Neutral, maintaining a hold action. At that time, the stock was priced at $100.61. UBS also raised the price target for SAIC from $110 to $113, as highlighted by TheFly.

SAIC's recent performance has been noteworthy, with a 16% surge in its stock price following its Q3 FY26 earnings release. This increase is attributed to impressive margin growth and a robust return on equity (ROE) of 23.75%, which outperforms its sector peers. Over the past five years, SAIC's net income has risen by 75.8%, showcasing strong management and capital efficiency.

The company's Q3 FY26 earnings report exceeded expectations, with non-GAAP earnings of $2.58 per share, surpassing the Zacks Consensus Estimate of $2.07 by 24.6%. Despite a slight decrease from the previous year's earnings of $2.61 per share, SAIC's consistent performance is evident. The company also reported revenues of $1.87 billion, slightly above the Zacks Consensus Estimate, despite a 5.6% year-over-year decline.

SAIC's strategic reallocation of $100 million in annual spending towards areas with higher returns on investment supports its growth. The management team is targeting margins approaching 10% in the near term, with expectations for further improvement in FY27. This strategic focus has helped boost investor confidence, as reflected in the company's raised fiscal year 2026 guidance for higher revenue, EBITDA, and EPS expectations.

SAIC's market position remains strong, with net bookings of $2.2 billion and a book-to-bill ratio of 1.2. The company's backlog stands at $23.8 billion at the end of the quarter. Despite a recent stock price decrease of 1.16%, SAIC's market capitalization is approximately $4.63 billion, with a trading volume of 1,195,725 shares.