CACI InternationalCACI

The business ended its fiscal year with $9.6 billion in sales, up about 11 percent from the year before. It earned $8.91 per share in the final quarter, which was well ahead of the $7.26 that analysts expected. This growth was fueled by a 66 percent jump in free cash flow, which is the actual cash a company has left over after paying for its operations and equipment.

This performance shows the company is successfully moving away from simple staffing services toward high-tech defense tools. It ended the year with $10.2 billion in new contract awards, keeping its total backlog of signed work very high. Management expects this momentum to continue into next year, forecasting more revenue growth and better profit margins as its specialized technology becomes a bigger part of the business.

See the full quarter, and how our tracked metrics did

Source: 8-K filing

Key highlights

• Strong revenue growth: Revenue in the fourth quarter grew 17.6% to $2.71 billion, supported by 11.6% organic growth, meaning the growth coming from existing operations rather than new acquisitions. This shows the company is successfully winning more work from its current technology and expertise base.
• Expanding profit margins: The company’s EBITDA margin, a measure of profit before certain expenses like interest and taxes, reached 13.0% this quarter compared to 11.5% a year ago. Management cited higher revenues and better cost management as the drivers for this improved efficiency.
• Backlog provides visibility: Funded backlog, which is the value of contracts that have been formally awarded and funded by the government, jumped 28.6% to $5.4 billion. While total backlog of $32.0 billion grew more slowly at 1.9%, the sharp rise in funded work gives the company more certainty about its incoming cash for the year ahead.
• Technology shift continues: Revenue from the company's technology segment grew 23.7% to $1.66 billion, now making up more than 61% of total sales. This is a positive shift for long-term owners because high-tech work often carries better profit than the company's traditional expertise-based services.
• Bright outlook ahead: For the upcoming fiscal year, the company expects revenue between $10.65 billion and $10.85 billion and adjusted profit between $32.96 and $33.86 per share. This forecast indicates that management expects to continue its streak of double-digit sales growth into 2027.

Our take: This was an excellent quarter that showed real momentum in the business. The combination of 11.6% organic growth and significantly higher profit margins proves CACI can grow quickly without relying solely on buying other companies. This performance strengthens the case for owning a high-quality government contractor that is clearly gaining market share.