Leidos Holdings (LDOS) has attracted fresh attention after securing new roles in the ExCURSion energy program with DARPA and landing four awards under the U.S. Department of State’s Evolve IT modernization contract.

Despite the new DARPA and Evolve contract roles, Leidos Holdings’ share price has come under pressure, with the 30 day share price return down 15.79% and the year to date share price return down 42.16%. Over the same period, the 3 year total shareholder return is 27.03%.

If these contract wins have you thinking about other government and infrastructure related opportunities, it could be worth scanning the grid focused 34 power grid technology and infrastructure stocks

With Leidos Holdings stock down sharply over the past year, yet trading at a sizeable discount to analyst price targets and some intrinsic value estimates, you have to ask whether there is real upside left or if the market already sees the future growth story.

Most Popular Narrative: 42.1% Undervalued

Against Leidos Holdings' last close of $106.11, the most followed narrative suggests fair value near $183, which implies a wide valuation gap that hinges on a handful of key growth and contract assumptions.

Leidos is positioned to benefit from increased, multi-year government funding focused on national security, defense modernization, border protection, and infrastructure, particularly through the One Big Beautiful Bill and related initiatives (e.g., FAA air traffic modernization, Golden Dome, maritime autonomy), which are expected to drive robust future revenue growth across core projects.

The key question is what sits behind that funding story, and how it translates into future revenue, margins, and valuation multiples. The fair value assessment uses a specific earnings path, disciplined profitability assumptions, and a discount rate that connects those estimates back to today. The full narrative details the calculations that support, or challenge, the $183 figure.

Result: Fair Value of $183.27 (UNDERVALUED)

However, the Leidos Holdings story could be challenged if U.S. federal spending priorities shift away from defense and civil technology, or if acquisition integrations weigh on margins and growth expectations.

Next Steps

If the mixed sentiment around Leidos Holdings leaves you uncertain, review the underlying data now so you can weigh both sides using the 6 key rewards and 1 important warning sign.

Looking for more ideas beyond Leidos Holdings?

If the Leidos Holdings setup has you rethinking your portfolio, now is a good time to scan fresh ideas before the next round of market moves passes you by.

• Target resilient cash generators by checking companies in the 44 high quality undervalued stocks that pair attractive pricing with solid underlying metrics.
• Prioritise capital protection by reviewing the 67 resilient stocks with low risk scores and see which businesses score well on stability and downside resilience.
• Spot future standouts early by running your eye over the screener containing 19 high quality undiscovered gems and seeing which quieter stocks already have the fundamentals in place.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.