CACI · CACI INTERNATIONAL CLA · Stock research

Current Thesis

The leg being bought is a re-rate of a federal IT services contractor into a defense-technology supplier. The FY2026 fourth-quarter print released 2026-08-05 carried Q4 adjusted EPS of $8.91 against a $7.21 consensus and Q4 revenue of $2.709B versus $2.693B expected, up 17.6% YoY with 11.6% organic growth. The FY2027 guide moved the forward number, not just the multiple: revenue $10.65–10.85B, adjusted EPS $32.96–33.86 against $30.78 consensus, GAAP EPS $25.74–26.64 against $22.19, free cash flow of at least $900M. Product content is the stated reason — SkyValor counter-drone entered full-rate production on 2026-07-31 under a three-year $500M IDIQ with JIATF-401, and management named electronic warfare, counter-UAS, space and AI-enabled modernization as the FY2027 growth pools. The load-bearing assumption is that a 12.4% midpoint revenue guide is deliverable off a total backlog that grew 2% YoY.

Bullish and bearish views on CACI INTERNATIONAL CLA

The model's bull view on CACI INTERNATIONAL CLA (CACI), in brief: FY2026 closed at $9.57B revenue, +10.9% YoY with 7.2% organic, EBITDA margin 12.3% (+110bps YoY), adjusted EPS $29.83 (+12.7%) — reported 2026-08-05. The bear view: Total backlog grew 2% YoY to $32B while FY2026 revenue grew 10.9% and FY2027 is guided to roughly 12.4% at the midpoint. Both cases follow in full.

Bull Case

• FY2026 closed at $9.57B revenue, +10.9% YoY with 7.2% organic, EBITDA margin 12.3% (+110bps YoY), adjusted EPS $29.83 (+12.7%) — reported 2026-08-05. Q4 EBITDA margin was 13.0%, up 150bps, so the margin line is expanding at the end of the year rather than the start.
• Free cash flow of $735M in FY2026 with a guide of at least $900M for FY2027 (2026-08-05 call). Cash conversion, not EPS optics, is what funds the deleveraging path from 3.7x pro-forma at FY2026 year-end toward the low-3x range management targets by June 2027.
• Funded backlog rose 29% YoY while total backlog exceeded $32B (2026-08-05). Funded is the near-term-convertible slice; its growth rate is what supports the first half of the FY2027 guide.
• FY2026 contract awards exceeded $10B, a 1.1x book-to-bill at roughly six-year weighted average duration (2026-08-05 call). Recent named wins: the 2026-07-31 SkyValor $500M three-year IDIQ with JIATF-401 and a five-year Navy Military Sealift Command award valued up to $113M announced 2026-07-16.
• Estimate revisions ran hard in the week after the print: UBS to $804 from $598 (2026-08-07), JP Morgan Overweight $715 (2026-08-07), Jefferies to $700 from $510, Stifel to $892 from $765. Consensus sat at $717.43 across 17 analysts, 13 Buy / 4 Hold / 0 Sell, range $550–$892.

Bear Case

• Total backlog grew 2% YoY to $32B while FY2026 revenue grew 10.9% and FY2027 is guided to roughly 12.4% at the midpoint. Backlog coverage is thinning; the 1.1x book-to-bill is barely above replacement.
• Leverage is 3.7x pro-forma at FY2026 year-end following the ARKA Group acquisition integrated during FY2026. The deleveraging case depends on the ≥$900M free cash flow guide landing.
• The gap between guided GAAP EPS ($25.74–26.64) and guided adjusted EPS ($32.96–33.86) is wide, and acquisition intangible amortization sits inside it. Q4 GAAP EPS declined YoY even as adjusted rose 6.1%.
• Citigroup maintained Neutral on 2026-08-11 and raised its target only to $648, which is below the 2026-08-14 close of $670.54. The consensus $717.43 sits close to spot; the sell-side gap that was the fuel in early August has largely been consumed.
• Revenue is concentrated in US federal contracts. The FY2027 appropriations deadline of 2026-09-30 is the gating item for new-start awards; a full-year continuing resolution restricts new programs regardless of pipeline quality.

Setup & Price Structure

Last completed daily close 2026-08-14: $670.54, against a 52-week high of $680.08 — 1.4% below it — with a three-month return of 37.7% and RSI(14) at 82.0.

Life-cycle: ACCELERATING, dated by the 2026-08-05 guidance reset, the 2026-07-31 SkyValor full-rate production award, and the cluster of target revisions between 2026-08-07 and 2026-08-11 (UBS $598→$804, Jefferies $510→$700, Stifel $765→$892). New attention arriving, participation widening, headline flow fresh.

Crowding and positioning observables, stated without a verdict attached:

• RSI(14) 82.0 as of 2026-08-14; Benzinga on 2026-08-13 listed CACI first among three industrials it flagged as overbought, citing RSI 82.3 at $680.08. Retail-facing overbought coverage has begun clustering.
• Price is 1.4% below the 52-week high after a 37.7% three-month advance — the run is extended relative to its own base.
• A Form 144 filed 2026-08-10 noticed a planned sale of 4,962 common shares with an indicated aggregate market value of $3,195,578.11, sourced from RSU vestings dated 2019-06-05 and 2020-06-05. A director sold 264 shares in mid-June 2026 per Form 4. Both are small and routine in shape; neither is a program.
• Unusual options activity coverage on 2026-08-06 and 2026-07-20 (Benzinga whale-alert screens) puts the name inside momentum-screening flow.
• No earnings inside the next 30 days. The Q1 FY2027 print is the next hard company event, historically late October — the FY2026 Q1 release landed 2025-10-22.

The structure to watch is the post-guidance range built from 2026-08-06 onward. The lowest identifiable close inside that range is roughly $646 on 2026-08-07 (implied by the $717.43 consensus target being described as ~11% above that session's close). Price holding above the high-$630s/$640s keeps the gap intact; losing it returns the stock into pre-print territory and hands the tape back to the mean-reversion screens.

Catalyst Calendar (next 30 days)

• ~2026-08-21 (est.) — FY2026 Form 10-K filing. CACI's fiscal year ends June 30 and the filing deadline for a large accelerated filer falls in late August; prior years were filed mid-August. First full look at contract-type mix, ARKA purchase accounting and the debt schedule behind 3.7x pro-forma leverage.
• 2026-09-30 (just outside the 30-day window) — end of US federal fiscal year and the FY2027 appropriations deadline. A continuing resolution with new-start restrictions is the single most direct threat to the award flow the FY2027 guide assumes.
• ~2026-10-21 (est.) — Q1 FY2027 results. The prior-year Q1 landed 2025-10-22. First test of the $10.65–10.85B revenue guide and the ≥$900M free cash flow target.

Elapsed catalysts

• Rolling, August–September 2026 — federal award announcements ahead of the government fiscal year-end. Obligations cluster into September; CACI announced the SkyValor IDIQ on 2026-07-31 and the Military Sealift Command award on 2026-07-16, both inside this window. (passed 15d ago)

What Would Change Our Mind

The structural break is the loss of the 2026-08-06 guidance gap. If the range built after the print fails — a daily close below $640, which sits under the ~$646 close of 2026-08-07, the lowest identifiable post-print close — the re-rate has been given back and the name reverts to trading on the pre-print multiple with a 3.7x leverage ratio attached.

Fundamentally, the thing that would flip the read is order coverage. Total backlog at $32B grew 2% YoY against a guide of 12.4% midpoint revenue growth; a Q1 FY2027 book-to-bill below 1.0x, or total backlog down sequentially, would say the FY2027 number is being served out of inventory rather than replenished. A full-year continuing resolution enacted at 2026-09-30 with new-start restrictions would do the same thing from the customer side.

The positioning condition: consensus is $717.43 against a $670.54 close on 2026-08-14, with Citigroup's $648 already below spot. If targets stop rising while price continues to, the setup migrates from ACCELERATING toward SATURATED and the fresh bid thins. RSI(14) at 82.0 and the 2026-08-13 overbought listicle are early markers of that transition, not proof of it.

Correlation Notes

• Moves with the government-services complex — LDOS, SAIC, BAH, PSN — on appropriations headlines, continuing-resolution news and DoD budget topline changes. Those shocks hit the group together and are largely independent of company execution.
• The counter-UAS, electronic-warfare and space content links CACI to the pure-play defense-technology cohort (KTOS, and the ITA/XAR baskets) more tightly than to legacy IT services. That correlation is what the 2026-08-05 re-rate is arguing for; a divergence where defense-tech names hold and CACI does not would argue the market is still pricing it as a services firm.
• With 3.7x pro-forma leverage at FY2026 year-end, the equity carries more rate sensitivity than a debt-free peer. Refinancing costs and the deleveraging path to low-3x by June 2027 are exposed to the front end of the curve.
• Election-cycle and appropriations-calendar risk is idiosyncratic to the federal contractor group and does not diversify against an S&P 500 index exposure during a shutdown scare.