AMTM Stock Forecast & Price Target

Amentum Holdings is supported by a large and improving backlog of $48.2bn, 1.1x quarterly book-to-bill, and $17.7bn of net bookings, which together provide strong revenue visibility across nuclear, defense, critical digital infrastructure, and space. The company also demonstrated solid fundamental execution in 3QFY26, with adjusted EBITDA rising 6% Y/Y to $290mn, margins expanding 60bps to 8.3%, free cash flow of $135mn exceeding expectations, and net leverage improving to 3.0x, indicating that profitability and deleveraging are advancing even when reported sales are pressured by contract transitions and divestitures. The positive long-term view is further reinforced by its concentrated exposure to attractive government and nuclear markets, a ~$32bn pending award pipeline, and management’s expectation that the remaining portfolio can still grow at a mid-single-digit rate even after near-term headwinds, suggesting durable earnings power and eventual top-line reacceleration.

Amentum Holdings is viewed negatively because its business is heavily tied to U.S. federal spending, with about 80% of revenues derived from the U.S. government and defense representing roughly 46% of revenues, leaving it exposed to budget delays, procurement protests, shifting priorities, and any sustained weakness in defense funding. Although fiscal 2Q26 adjusted EPS of $0.60 beat consensus of $0.57 and underlying revenue rose about 3% YoY after divestiture and JV-transition headwinds, the company still posted only flat reported revenue, showing that core growth remains modest and operational improvement is being offset by portfolio changes. The investment case is further constrained by execution and financial risk, including roughly 10-15% of annual revenue subject to recompete risk, about 23% of revenue under fixed-price contracts and therefore vulnerable to inflation, and net leverage of 3.2x exiting fiscal 2Q26, which limits flexibility even as deleveraging remains a priority.