Why Booz Allen Hamilton Stock Soared Today

Booz Allen Hamilton (BAH) jumped 10.49% after the government contractor delivered first-quarter fiscal 2027 earnings per share of $1.81, crushing the $1.49 analyst consensus by 21%. Revenue came in slightly below expectations but the company posted $261 million in free cash flow, up 172% year-over-year.

The defense and intelligence consulting firm issued full-year 2027 guidance of $11.2 billion to $11.7 billion in revenue with adjusted EBITDA projected between $1.24 billion and $1.29 billion. The stock now trades at 7 times operating cash flow, well below its five-year average multiple of 16 times, suggesting the market has overcorrected despite strong operational performance.

The cash flow surge stands out as the key metric driving the rally. Booz Allen's government-heavy client base provides revenue stability, and the 172% year-over-year improvement in free cash flow generation signals improved contract profitability and working capital management.