June 12 U.S. intelligence agencies will likely
freeze some of Booz Allen Hamilton Holding Corp's
projects temporarily, pending a review of how the company
handles classified information, Susquehanna Financial Group
analysts said, trimming their earnings estimates for the
company's fiscal 2014.
Booz Allen shares, majority owned by private equity firm
Carlyle Group LP, were down 3.6 percent at $16.53 in late
afternoon trading on the New York Stock Exchange on Wednesday.
Booz Allen, which generated 23 percent of its revenue from
U.S. intelligence agencies in the financial year ended March 31,
said on Sunday that one of its employees was responsible for
leaking details of a top secret U.S. surveillance program.
Edward Snowden, a former technical assistant at the CIA, had
been working for three months at the National Security Agency
under a Booz Allen contract.
"Our conversations with agencies and vendors over the last
few days reveal that a number of competitors are subtly
incorporating this incident into their contract bids against
Booz Allen," Susquehanna analysts led by James Friedman said in
a note to clients.
The analysts cut their revenue estimate to $5.58 billion for
the year ending March 31, 2014. They also cut their earnings
estimate to $1.40 per share from $1.47, citing possibility of
work stoppage pending the process review.
Analysts on average are expecting earnings of $1.56 per
share on revenue of $5.65 billion, according to Thomson Reuters
The Susquehanna analysts reiterated their "negative" rating
on the company.
Separately, Standard & Poor's Ratings Services on Wednesday
maintained its "BB" corporate credit rating on Booz Allen, but
warned that the company's future revenue could be hurt if it
failed to maintain confidentiality and adequate protection
against security breaches.