Parsons stock price target raised to $93 from $87 at KeyBanc

Investing.com - KeyBanc raised its price target on Parsons Corp. (NYSE:PSN) to $93.00 from $87.00 on Monday, while maintaining an Overweight rating on the stock. Currently trading at $82.74, Parsons has demonstrated strong momentum with a 27.06% return over the past six months, according to InvestingPro data.

The firm cited multiple factors for the increased target, including a higher target multiple as "the dust clears on the confidential contract" and potential for continued margin expansion.

KeyBanc also highlighted Parsons’ potential role as an integrator in the upcoming FAA air traffic control contract as a factor in its decision.

The Critical Infrastructure (CI) segment was noted for its continued growth trajectory, with strong exposure to the Middle East and a growing domestic base.

KeyBanc expects margins to trend upward as legacy projects in the CI segment finish and the segment grows to represent approximately 50% of the business in 2025, compared to roughly 40% in 2024.

In other recent news, Parsons Corporation announced its acquisition of Applied Sciences Consulting, Inc., an engineering firm based in Tampa, Florida. This acquisition, an all-cash transaction, enhances Parsons’ capabilities in water infrastructure resilience across Florida. In another development, Parsons, as part of the MPA Delivery Partners joint venture, secured a $665 million contract extension for the Hudson Tunnel Project, which is considered one of the most critical rail infrastructure projects in the U.S. Additionally, Parsons has opened a new 27,000-square-foot facility near Redstone Arsenal in Huntsville, Alabama, to support advanced defense programs.

Parsons also secured an $81 million contract with the U.S. Army Combat Capabilities Development Command for radar engineering solutions, under a strategic sourcing agreement. On the financial front, KeyBanc has raised its price target for Parsons to $87 from $84, maintaining an Overweight rating, after discussions with the company’s leadership about growth opportunities. These recent developments highlight Parsons’ ongoing expansion and involvement in significant infrastructure and defense projects.

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