I’ve been looking into Amentum (AMTM) recently because the stock has been pretty beaten down and recently hit a 52-week low. I’m wondering if this could be a good long-term value/recovery play.
My thinking is:
Government customers: A large part of their business comes from the U.S. government, which should provide relatively steady and predictable demand.
Large backlog: They have a significant backlog of contracts. I realize backlog isn’t guaranteed revenue, but I would think a large portion should eventually turn into revenue as long as the contracts remain funded.
Good areas to be in: They’re involved in nuclear, space/defense, engineering, and cybersecurity. These seem like areas where the U.S. government will continue spending heavily for years.
However, they are heavily dependent on government spending, government contracts can have relatively low margins, and contracts can be cancelled.
Do you think AMTM is a good long-term value/recovery play at this price?