CACI refers its operations within two main segments:

  • Expertise: focuses on specialized areas like software development, data analysis, naval architecture, and intelligence operations.
  • Technology: using AI-driven data platforms, agile software, and advanced tools for spectrum management, security, and network management

CACI maintains a well-balanced revenue mix, with Expertise contributing $3.473 billion (46.7% of total revenue) and Technology accounting for $3.959 billion (53.3%). The Expertise segment operates with low to medium barriers to entry, requires minimal investment, but generates lower margins. In contrast, the Technology segment features high barriers to entry, demands significant investment, and delivers higher margins.

CACI operates across key segments, including Digital Solutions (streamlining government operations), C4ISR (enhancing electromagnetic spectrum control, counter-drone capabilities, and addressing 5G and mmWave complexities), and Cyber and Space (advancing laser-based free-space optical communications and long-range sensing technologies). Despite its international presence accounting for only 3% of operations in 2024, domestic activities dominate with 97%. Over the 2014–2024 period, CACI delivered a strong return to shareholders, outperforming the S&P 500 with a +600% gain compared to the index's +300%.

CACI holds a strong position with U.S. government and federal agencies, backed by exclusive multi-year contracts. In 2024, the Department of Defense (DoD) was the primary revenue source, contributing $5.695 billion (76.5% of total revenue), compared to $1.588 billion (21.5%) from federal civilian agencies, while commercial and other revenues accounted for just $149 million (2%).

The Fiscal Year 2025 defense budget request stands at $849.8 billion, up from $824.3 billion in 2024 and $816.7 billion in 2023. The Congressional Budget Office (CBO) projects a further 11% increase in defense spending over the next decade, reaching $965 billion by 2039. However, plans from the Trump administration to establish the Department of Government Efficiency (DOGE), led by Elon Musk and Vivek Ramaswamy, aim to streamline the federal government, potentially reducing defense spending and impacting military contracting revenues.

CACI has strengthened its capabilities through recent acquisitions, including three in 2024, highlighted by the $1.275 billion purchase of Azure Summit Technology, specializing in advanced RF and electromagnetic spectrum engineering. In 2023, it acquired a UK firm offering software engineering, data analysis, and cyber services for national security. In 2022, CACI added four companies providing open-source intelligence, specialized cyber tools, satellite communications, photonics for free-space optical systems, and classified security solutions.

CACI demonstrated steady revenue growth from $5.72 billion in 2020 to $7.66 billion in 2024, reflecting a 6% CAGR, while net income, after peaking at $457 million in 2021, dipped to $367 million in 2022 before recovering to $420 million in 2024. Over the same period, EBITDA (10.5% margin) rose consistently from $574 million to $798 million, and adjusted EPS increased from $14.33 to $21.05 (8% CAGR). However, free cash flow (5% margin) saw a significant decline, dropping 59% from $695 million in 2022 to $282 million in 2023, with a partial recovery to $384 million in 2024.

Looking ahead, analysts predict revenue growth to $8.5B in 2025 and $9.5B in 2027, with EBITDA expected to reach $1.079B by 2027. The group has significantly improved its net income in recent years, with forecasts projecting an increase from $420M in 2024 to $575M in 2027. However, a key concern is the rising debt, expected to grow by 65%, from $1.4B in 2024 to $2.32B in 2025.Despite this, profitability metrics remain strong. ROE and ROA are predicted to return to their 2021 levels by 2027, reaching 16.92% and 7.77%, respectively. Additionally, the group’s EPS is expected to see a substantial increase from $18.60 in 2024 to $26.75 by 2027, reflecting a CAGR of +9.5%.

CACI reported strong performance in Q1 2025 and raised fiscal year guidance, with revenues of $2.1 billion, an 11% increase year-over-year, and a net income of $120.2 million, reflecting a 42% growth. Adjusted net income reached $133.6 million, and diluted EPS rose by 36% to $5.93. EBITDA improved to $215.9 million, with a 10.5% margin, up 110 basis points. Contract awards totaled $3.3 billion, with 75% representing new business, including significant task orders for the U.S. Navy and USCENTCOM. Notable awards include an $805 million contract supporting NavalX and a $314 million contract for the NUWC’s modernization program with the total backlog grew by 21.3% YoY to $32.4 billion.

Since 2023, CACI has traded above its 10-year average P/E ratio of 17.7x, reaching 20.7x and 23.1x in 2023 and 2024, respectively, with projections at 22.5x for 2025. Operating in a highly competitive industry, where many peers are privately held such as ASRC Federal, General Dynamics Information Technology, Booz Allen Hamilton, Parsons, SAIC, Northrop Grumman, and Leidos Holdings, an overly high valuation could challenge future growth.

CACI is a well-managed company operating in a niche sector, working primarily and almost exclusively with government entities. However, this year’s policy changes could have a significant impact on the group, despite its efforts to remain innovative. The company's ability to acquire and integrate new businesses while providing strong visibility on future results makes it worth keeping an eye on.