Leidos Holdings, Inc. (LDOS): A Bull Case Theory 

We came across a bullish thesis on Leidos Holdings, Inc. on Value investing subreddit by zomol. In this article, we will summarize the bulls’ thesis on LDOS. Leidos Holdings, Inc.’s share was trading at $178.58 as of September 4th. LDOS’s trailing and forward P/E were 16.77 and 14.79 respectively according to Yahoo Finance.

Leidos (LDOS) is a mission services and systems integrator serving the Pentagon and U.S. government, with 44% of revenue from National Security & Digital programs and 30% from Health & Civil contracts. The company provides end-to-end solutions, including secure networks, sensors, cloud migrations, cyber defense, health IT systems, and long-term mission operations. Its applied AI capabilities support faster decision-making under strict security standards, making Leidos deeply embedded in critical infrastructure.

While Palantir (PLTR) appears very different as a software vendor, both companies overlap in delivering data integration, decision-support systems, and AI-enabled capabilities to governments and large institutions. The distinction lies in delivery: Leidos is service-heavy, relying on large teams, integration, and operations, while Palantir is product-heavy, monetizing platforms like Gotham, Foundry, and AIP with embedded engineers for configuration. Financially, Leidos generates $17B in annual revenue and $10.7 EPS with thin but stable margins, while Palantir earns $3.4B revenue with ~80% gross margins, reflecting its scalable software model.

Valuation, however, highlights the divide: Leidos trades modestly at 15× forward P/E and 11× EV/EBITDA, while Palantir commands lofty multiples of 85× P/E and 70× EV/EBITDA, driven by AI growth expectations. For investors, the choice is between stability and asymmetry: Leidos offers predictable cash flows, a $46B backlog, and potential re-rating toward a fair value of $250–300 per share (25–30% upside), while Palantir remains riskier and priced for perfection, with fair value closer to $30–50. In risk/reward terms, Leidos stands out as the stronger and more underappreciated opportunity.

Previously we covered a bullish thesis on Palantir Technologies Inc. (PLTR) by Deep Value Returns in May 2025, which highlighted its AI-driven software platforms, strong government and commercial contracts, and rapid revenue growth. The company’s stock price has appreciated approximately by 43.43% since our coverage due to continued platform adoption. The thesis still stands as long-term AI growth remains intact. Zomol shares a similar but emphasizes Leidos’ service-heavy, mission-critical government operations and stable cash flows.

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Disclosure: None.