Industrials
48/100
48/100Is AMTM-Amentum Holdings, a buy?
Sunday 26 July 2026
Why now: The business has recently reaffirmed full-year guidance and reported strong quarterly cash generation, which can matter more than short-term chart noise for a 1+ year view. Timing is mixed because the technical snapshot is not a breakout setup, but the stock is still pricing in a lot of skepticism versus the company’s earnings and cash flow targets.
Upside: If the company executes to its fiscal 2026 adjusted EPS range and maintains cash conversion, the stock has room to re-rate toward a more typical contractor multiple; a reasonable 12-month upside range is roughly 25% to 55% from the current print. Upside is primarily fundamental, not a momentum chase.
Risks: The biggest risks are contract execution and funding timing, since the business is heavily dependent on US government budgets and program transitions. Leverage is also meaningful, so any cash flow disappointment can hurt equity value quickly.
Sign up or log in for access
Unlock the full scorecard, detailed analysis, and research notes. Free, no credit card needed.
Scorecard
Read:Strong metricsSolid metricsSelectiveCautionUnfavourableN/A
| Scorecard | 48/100 | |
|---|---|---|
| Company Detail | AMTM, Amentum Holdings, Inc. | |
| Price as at 24 July 2026 | $22.55 | |
| Market cap | $5.5B | |
| Quality and Fundamental Score (100) | ||
| Breakout / Early-Momentum /20 | 0/20 | |
| Rev/EPS Momentum /20 | 12/20 | |
| Business Quality /15 | 5/15 | |
| Balance Sheet /15 | 10/15 | |
| Valuation /10 | 7/10 | |
| Industry Relative Strength /10 | 4/10 | |
| Macro / Sector Tailwind /10 | 10/10 | |
| Growth | ||
| Cash runway | Cash generative | |
| Revenue YoY | +71.6% | |
| EPS YoY | +130.0% | |
| FCF YoY | +1333.3% | |
| Gross margin | 10.5% | |
| Valuation & Trend | ||
| Trailing P/E | 37.6x | |
| Forward P/E | 8.1x | |
| RSI (14d) | 60 | |
| vs 50d SMA | +2.8% | |
| Support cushion | −1.7% | |
| Sentiment | ||
| Wall Street verdict | Aligned | |
| News tone | Mixed | |
| Dividend | — | |
How are these colored?
| Metric | Strong metrics | Solid metrics | Selective | Caution | Unfavourable |
|---|---|---|---|---|---|
| Overall score | ≥ 80 | 70-79 | 60-69 | 50-59 | < 50 |
| Business quality /15 | ≥ 12 | 10-11 | 8-9 | 6-7 | < 6 |
| Balance sheet /15 | ≥ 12 | 10-11 | 8-9 | 6-7 | < 6 |
| Market cap | ≥ $20B | $5B-$20B | $2B-$5B | $1B-$2B | < $1B |
| Cash runway | ≥ 3 yr or cash generative | 1.5-3 yr | 0.75-1.5 yr | 0.25-0.75 yr | < 0.25 yr |
| Revenue YoY | ≥ 15% | 5-15% | 0-5% | -5-0% | < -5% |
| EPS YoY | ≥ 20% | 5-20% | 0-5% | -5-0% | < -5% |
| FCF YoY | ≥ 10% | 1-10% | 0-1% | -5-0% | < -5% |
| Gross margin | ≥ 60% | 40-60% | 25-40% | 10-25% | < 10% |
| Trailing P/E | < 15 | 15-25 | 25-35 | 35-40 | > 40 or neg |
| Forward P/E | < 15 | 15-25 | 25-35 | 35-40 | > 40 or neg |
| RSI (14d) | 50-70 | 45-50 or 70-75 | 40-45 or 75-78 | 30-40 or 78-80 | < 30 or > 80 |
| vs 50d SMA | +2% to +15% | 0-2% or 15-25% | -2-0% or 25-35% | -3, 2% or 35-40% | < -3% or > 40% |
| Support cushion | 2-10% above | 0-2% | 10-15% | 15-20% | price below support |
| Wall Street verdict | Aligned | — | Mixed | — | Disagrees |
| News tone | Positive | — | Neutral / Mixed | — | Negative |
| Dividend | Yield ≥ 2% & growing | Growing | Flat payer ≥ 1% | Low / flat | Cutting |
Detailed Analysis, Sunday 26 July 2026
What they do
Amentum Holdings, Inc. is a government and commercial engineering and technology services contractor that delivers mission-focused work across national security, nuclear and environmental programs, space operations, and digital modernization. It makes money by performing long-duration contracts, often with the US federal government and allied governments, and converting awarded backlog into revenue and cash flow.
Leadership
John E. HellerCEO
John E.
Travis B. JohnsonCFO
Travis B.
Steve ArnetteCOO
Steve Arnette serves as Chief Operating Officer (tenure date not verified in the sources reviewed).
Customers & notable contracts
Receiver of capital expenditure: No, This is primarily a services contractor paid through contract funding rather than a company that directly receives broad-based customer capital expenditure in the way equipment makers do.
Main customers
- US Department of Energy (Major end-customer tied to nuclear, environmental, and energy programs; the company reports the US government is the dominant revenue source.)
- NASA (Space operations and mission support work; long-standing relationship cited by the company.)
- US Department of Defense (Defense and mission support services; part of the company’s large federal customer base.)
- UK Nuclear Decommissioning Authority (International nuclear and environmental services customer example.)
Notable contracts
- NASA COSMOS contract (via ASCEND Aerospace & Technology joint venture), Up to $1.8 billion; five-year base period with options extending to 2034 (Mission operations and systems services supporting Johnson Space Center programs including Artemis-related activities and other human spaceflight operations.)
Summary thesis
- Amentum is a large, mission-critical services contractor with a backlog-driven model that can produce steady cash flow when execution is tight.
- The current appeal is that recent results showed improved profitability and very strong quarterly free cash flow, while management reaffirmed full-year guidance, suggesting a clearer earnings path than the stock price implies.
- The long-term question is whether margin expansion initiatives can persist while contract mix shifts and new awards ramp, because that determines how durable earnings quality really is.
Wall Street alignment
Wall Street: Mostly aligned (2/4 positive)
Analyst consensus
Buy (2.42, 12 analysts) · +41% upside
Institutional ownership
107% institutions, insiders 1.2%
Short interest
8.8% of float short · 6.5 d-to-cover
Smart money tape
+1 net (acc 1 / dist 0, last 26d)
Recent news
News Mixed · last 7d
Show 3 headlines from the last 7d
2026-07-22Analyst+
Zacks Research upgraded Amentum Holdings to strong buy ↗ · Zacks Research
Zacks Research raised its rating on AMTM to strong buy. This can influence near-term sentiment, but it does not change the company’s fundamentals by itself.
2026-07-20Contracts+supportive
Amentum said it was selected by the National Nuclear Security Administration to enter negotiations for a phased lease tied to a planned one gigawatt artificial intelligence data center with on-site power generation at the Savannah River Site. If finalized, it would reinforce Amentum’s positioning in government-led energy and artificial intelligence infrastructure work.
2026-07-20Analyst−challenging
Bank of America lowered Amentum Holdings price target to 30 dollars and kept neutral rating ↗ · MarketBeat (via Benzinga)
Bank of America cut its price target on AMTM from 35 dollars to 30 dollars while keeping a neutral rating. This signals more cautious expectations for valuation and near-term upside.
Dividends
Pays no regular dividend.
Technicals
Price
$22.55
RSI (14d)
60.3
50d SMA
$21.93
200d SMA
$26.53
vs 50d SMA
+2.8%
vs 200d SMA
-15.0%
Support (swing low)
$22.17 −1.7%
Next swing high (swing high)
$23.40 +3.8%
Close as of 2026-07-24.
Score breakdown
Scores 48 out of 100, a mixed overall grade. Sector fit scored highest. Valuation and balance sheet were fair but not standout drivers. Relative strength versus its industry and business quality weighed on the total. The score is capped because the current technical setup is weak (no rising 200-day trend and no confirmed reclaim in the provided technical snapshot), so the stock does not have a clean “institutional accumulation” look right now even though fundamentals are improving.
Component scores are on the scorecard above.
Momentum evidence
- The provided technical snapshot does not show a pre-breakout profile: the 200-day trend is not rising and there is no confirmed breakout or “hold above resistance” signal.
- The stock is modestly higher in the current premarket print versus the prior close, but that does not change the broader point that momentum is not yet confirming a longer-term uptrend.
Fundamental evidence
- In the fiscal second quarter ended April 3, 2026, Amentum reported revenue of $3.478 billion and GAAP net income of $54 million, with adjusted EBITDA of $275 million and adjusted diluted EPS of $0.60.
- Cash generation was strong in the quarter with operating cash flow of $225 million and free cash flow of $220 million, and management highlighted backlog of $47.8 billion.
- Balance sheet leverage remains a real factor: the company disclosed $4.0 billion of gross debt and $428 million of cash as of April 3, 2026.
- The model also carries typical contractor complexities, including contract transitions into joint ventures and non-GAAP adjustments; investors should focus on sustained cash conversion and whether margins hold as programs roll off and new awards ramp.
Cash runway: Cash generative (latest annual free cash flow is positive).
Valuation view
On common market data sets, the stock screens as inexpensive on forward earnings and roughly mid-single-digit to high-single-digit EV to EBITDA, which can be attractive for a contractor if guidance is reliable and cash conversion holds. The catch is that reported trailing earnings can look distorted versus forward metrics, so valuation comfort depends on confidence in adjusted earnings and free cash flow delivery rather than the headline trailing multiple.
Macro tailwind
Federal priorities around national security, nuclear work, space operations, and cyber and digital modernization create a supportive demand backdrop for large, credentialed contractors, even if the broader economy slows.
What to watch
Upcoming (1-6 months)
- Next earnings update (expected in August 2026 based on historical patterns; confirm when the company posts the date).
Ongoing
- Backlog conversion into revenue and whether free cash flow stays strong as working capital normalizes and contract transitions continue.
Long-term case
Over a multi-year horizon, the case rests on three drivers: (1) steady demand for mission-critical government services in energy, defense, intelligence, space, and cyber; (2) management’s ability to expand margins through operational discipline and mix shift toward higher-value digital work; and (3) consistent free cash flow that supports debt reduction and improves equity durability. If these hold, Amentum can behave like a stable compounder despite uneven quarterly revenue growth driven by program timing.
Risks & invalidation
Risks
- Budget disruption, contract recompete losses, or program delays that reduce backlog quality or slow award ramps.
- Execution problems (cost overruns, margin compression, or weaker cash conversion) that make adjusted earnings less predictive of true owner cash flow.
Breaks the thesis
- If the company materially reduces its full-year guidance or free cash flow outlook, the “cheap on forward numbers” support breaks and the long-term case weakens sharply.
Bottom line
Amentum is a large, backlog-driven government services contractor tied to durable areas like defense, nuclear work, space operations, and digital modernization. The business is showing improving profitability and strong cash generation, but the stock’s chart snapshot is not confirming a clean long-term uptrend yet, so patience on timing matters. The main swing factor over a 1+ year hold is whether management can keep converting backlog into steady free cash flow while paying down debt.