November 21 Market Close: GovCon Index Advances, KBR & Leidos Get Upgrades as Cubic Falls on Guidance Miss

GovConIndexUPExecutive Mosaic’s GovCon Index advanced for a third consecutive session Monday on a mix of contributions from large primes and services stocks but a sharp fall by Cubic Corp. (NYSE: CUB) pared the GCI’s gain after the contractor’s guidance missed analysts’ expectations.

GovCon Index gainers outnumbered decliners by a 5-to-1 ratio and seven of its 11 S&P 500 components closed green with General Dynamics (NYSE: GD) the top net performer in the GCI overall and among co-listed stocks.

KBR (NYSE: KBR) led GCI percentage advancers after MKM Partners upgraded the stock to “Buy” from “Neutral” with a $21 price target versus the prior $15 mark as analyst Daniel Scott noted the company’s mix of government services and technology business added this year through acquisitions along with its traditional hydrocarbons business.

MKM Partners analyst Daniel Scott told analysts in a research note the firm expects contract activity in the aerospace, defense and government technology sectors to pick up under incoming President Donald Trump’s administration with a Republican-controlled Congress.

Leidos Holdings (NYSE: LDOS) climbed on a Credit Suisse upgrade to “Outperform” from “Neutral” in a note to investors Monday with a price target lift to $54 from $40.50.

Credit Suisse based its new rating on expectations of upside resulting from cost synergies out of its August merger into the former Lockheed Martin (NYSE: LMT) services segment, according to the Washington Business Journal.

Nine GovCon Index companies added at least $1.00 in Monday trade and four hit new 52-week highs during the session.

Cubic Corp. (NYSE: CUB) weighed on the GCI as its lowest net and percentage performer after the San Diego-based defense and transportation contractor issued full-year earnings and revenue guidance below Wall Street analysts’ expectations.

A 2-percent gain in energy stocks led the S&P 500 to a record high close with all 11 other major sectors higher as investors showed optimism that OPEC is near an agreement on a production cut.

Crude oil futures in New York settled up 3.9 percent to $47.49 and hit a three-week high during the session, according to Reuters.

Market Summary

Index Value Net Change % Change
GovCon Index 87.608 +0.359 +0.411%
S&P 500  2, 198.18 +16.28 +0.75%
Dow Jones Industrial Average 18, 956.69 +88.76 +0.47%
NASDAQ 5, 368.86 +47.35 +0.89%
Advancing GovCon Index Issues 25
Declining GovCon Index Issues 5
Unchanged GovCon Index Issues 0

Top GovCon Index Net Gainers

Symbol Company $ Current Price Net Change ▴ % Change
GD General Dynamics * 168.43 +1.81 +1.09%
CACI CACI International 126.10 +1.40 +1.12%
SAIC SAIC 80.88 +1.39 +1.75%
MCK McKesson Corp. * 141.35 +1.30 +0.93%
GIB CGI Group 48.14 +1.10 +2.34%

Top GovCon Index Percentage Gainers

Symbol Company $ Current Price Net Change % Change ▴
KBR KBR 16.78 +0.53 +3.26%
GIB CGI Group 48.14 +1.10 +2.34%
LDOS Leidos Holdings 49.45 +1.09 +2.25%
BAESY BAE Systems 29.935 +0.625 +2.132%
ICFI ICF 52.60 +1.00 +1.94%

Lowest GovCon Index Net Performers

Symbol Company $ Current Price Net Change ▾ % Change
CUB Cubic Corp. 44.20 -5.05 -10.25%
CSRA CSRA * 31.31 -0.36 -1.14%
MANT ManTech International 43.34 -0.16 -0.37%
LLL L-3 Communications * 152.11 -0.09 -0.06%
EGL Engility Holdings 35.00 -0.01 -0.03%

Lowest GovCon Index Percentage Performers

Symbol Company $ Current Price Net Change % Change ▾
CUB Cubic Corp. 44.20 -5.05 -10.25%
CSRA CSRA * 31.31 -0.36 -1.14%
MANT ManTech International 43.34 -0.16 -0.37%
LLL L-3 Communications * 152.11 -0.09 -0.06%
EGL Engility Holdings 35.00 -0.01 -0.03%
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