Parsons Corporation (PSN)

NYSEIndustrialsInformation Technology ServicesSnapshot 2026-09-04

$47.58+2.65%

Close 2026-09-04 · 1-day change

Standing thesis

The standing, falsifiable read: what has to stay true, and what would break it.

Compounder

Broken: Primary pillar broken — Generate free cash flow near $500 million in fiscal 2026: FCF guidance $430M-$490M vs ~$500M target.

The bull case

Parsons keeps its 2026 revenue guidance near $6.65 billion. Free cash flow is expected around $500 million. New contracts in infrastructure and defense support growth. Profit margins stay stable near current levels.

The bear case

Revenue and profit margins could fall below guidance. Free cash flow might stay negative longer. Competition or project delays could hurt growth.

What's priced in

The price is about 44% below our fair value near $101. Analysts expect about 9% revenue growth, which we agree with.

What has to stay true

Maintain adjusted EBITDA near $645 million in fiscal 2026Broken
Marginsupporting~$645 million · FY26 (guidance)
Breaks if: Adjusted EBITDA falls below $600 million in FY26
Are they delivering?Mixed this quarter· 1 tracked commitment
- Reiterate fiscal year 2026 adjusted EBITDA guidanceGrowth
  Maintain fiscal year 2026 adjusted EBITDA guidance with updated ranges reflecting portfolio actions and operational performance.
  Mixed

Source: QuarterlyIQ research model· Written 2026-07-08· Health checked 2026-09-04· Version 1· Status: Broken· Reviewed when the evidence changes

This is not a price target or investment advice.

Current Outlook

Week of Sep 5, 2026

A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.

PSN's long-term thesis is currently weakened due to recent performance and sector headwinds.

What kind of bet this is

This investment represents a turnaround opportunity. The current thesis state is mixed, as management has lowered guidance while maintaining focus on revenue and cash flow.

What's priced into Parsons Corporation (PSN)

The market appears to have priced in a neutral valuation, with PSN being seen as cheap compared to its peers. There is a notable expectations gap, suggesting that some negative developments are already reflected in the current valuation.

What the fundamentals likely do

Fundamentals may remain under pressure in the near term due to elevated risk and a recent earnings miss. Management's mixed guidance updates indicate a cautious approach, which could impact performance.

What Parsons Corporation (PSN) hinges on

The thesis hinges on whether PSN can reverse its recent guidance cuts and if sector leaders continue to perform well. Any shifts in the performance of key competitors could significantly influence PSN's trajectory.

What changed in the latest read

What changed

The most important moves since the prior daily snapshot.

Short-term · Daily

No material changes since the prior snapshot.

Yes, our read has weakened. Recent financial performance dropped from the top half to the bottom half of its industry. This change indicates a weakening reason to own the stock. Additionally, the latest earnings report showed a significant miss, which further supports this view.

as of 2026-09-04

See upcoming information that could change the risk

Review the evidence to watch, what would become a concern, and what would make it less concerning.

Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.