10 Best Information Technology Services Stocks to Buy Right Now

2. CACI International Inc (NYSE:CACI)

Analyst Upside: 58.05%

No. of Hedge Fund Holders: 38

CACI International Inc (NYSE:CACI) offers expertise and technology solutions for national security across intelligence, defense, and federal civilian sectors. The company operates through Domestic and International segments, providing digital modernization, C4ISR, cyber, space, logistics, engineering, IT, and mission support solutions to government and commercial clients.

On January 23, Raymond James analyst Brian Gesuale elevated the price target on CACI shares from $475 to $490, keeping an Outperform rating on the shares. Gesuale cited that CACI International Inc’s (NYSE:CACI) shift towards a higher value technology offering, and transition from a portfolio that was historically 80% expertise, has led to a positive change in business mix. The analyst added that this has contributed to an approximate 200 basis point increase in EBITDA margin over the past eight years. Moreover, CACI’s recent performance backs this growth momentum.

Meridian Contrarian Fund remains highly bullish on the company, which is their largest holding. The fund cites its essential role in US defense IT infrastructure and consistent growth over a 10+ year investment period. It stated the following in its Q3 2024 investor letter:

“CACI International Inc (NYSE:CACI) is an IT consultant and provider of mission-critical technology to the U.S. Government and its agencies, which account for nearly 95% of its sales. CACI plays a vital role in modernizing IT infrastructure, systems, and other essential defense needs for the U.S. We have held CACI for over 10 years as the company has consistently grown into a larger supplier to the U.S., and increasingly, to our allies. The company’s stable growth and role as an essential provider of U.S. defense infrastructure were recognized by the market, delivering a solid return for shareholders in the quarter. We maintained our position throughout the period and, as of quarter-end, CACI was the Fund’s largest holding.”