Breaking Down CACI International Inc (CACI) Financial Health: Key Insights for Investors

You're looking at CACI International Inc. and wondering if their defense-contracting dominance is sustainable given the current budget uncertainty in D.C. The short answer is yes, they've built a defintely strong financial moat, but you still need to watch the political winds. Fiscal Year 2025 results were exceptional, showing annual revenues of $8.6 billion, a 13% jump year-over-year, and diluted EPS (Earnings Per Share, the portion of a company's profit allocated to each outstanding share of common stock) soaring 20% to $22.32. That kind of growth is rare in this sector. Their massive $31.4 billion total backlog, which is nearly four years of revenue visibility, gives them a huge buffer. But here's the realist check: while they secured $9.6 billion in new contract awards, the near-term risk of a drawn-out Continuing Resolution (CR) in the government's FY2026 budget process could still slow down the timing of new task orders and cash flow, so you need to understand where that backlog is actually funded.

Revenue Analysis

You need to know where the money is coming from to truly understand CACI International Inc (CACI), and the picture is one of consistent, defense-focused growth. For fiscal year 2025 (FY2025), the company reported total annual revenues of approximately $8.63 billion, which is a solid 12.6% increase year-over-year (YoY).

That growth wasn't just from buying other companies; a significant chunk, 7.2%, was organic growth, meaning it came from their existing business and new contract wins. This tells you the core business of providing expertise and technology to the U.S. government is defintely strong. The revenue stream is incredibly stable, too: management noted that over 97% of the expected FY2025 revenue came from existing programs.

The primary revenue sources are overwhelmingly tied to the U.S. national security apparatus. CACI International Inc (CACI) operates in two main segments-Domestic Operations and International Operations-but the split is dramatic. Domestic Operations accounted for a massive 97% of their total revenues in FY2025. International Operations, primarily in Europe, only make up the remaining 3%, so you are fundamentally investing in a U.S. government contractor.

Looking at the customer base gives you a more granular view of the revenue contribution, which is critical for assessing budget risk. Here is how the revenue broke down in the first quarter of fiscal year 2026 (Q1 FY2026), showing the clear dominance of defense and intelligence customers:

The growth in Federal Civilian Agencies and the Intelligence Community is outpacing the DoD, and that's a key trend to watch. You want to see that diversification. The total Q1 FY2026 revenue was $2.29 billion, an 11.2% increase from the prior year period.

The most significant change in revenue streams isn't the customer, but the type of work. CACI is strategically shifting toward higher-value, technology-focused offerings, especially in software-defined capabilities. This focus is directly tied to major contract wins, like the substantial five-year agreement valued at up to $855 million with the US Army Intelligence and Security Command (INSCOM). This move into software-enabled solutions, like the TLS Manpack, is what is driving the robust growth and positioning them for future federal agency contracts that prioritize agility and modernization. If you want to dive deeper into their strategic goals, I suggest reading their Mission Statement, Vision, & Core Values of CACI International Inc (CACI).

Here's the quick math: the consistent double-digit revenue growth and the strong backlog of $33.9 billion as of September 30, 2025, show a company with excellent visibility into future revenue. You're not guessing on where the next dollar will come from; it's already in the pipeline, which is a huge risk mitigator for this sector.

• Revenue is primarily U.S. government-backed.
• Growth is a healthy mix of organic and acquisition-driven.
• Future revenue is highly visible due to a large backlog.

Next step: For your own portfolio modeling, track the year-end contract award announcements, as those are the leading indicators for next year's revenue growth. Finance: check the Q2 FY2026 earnings call transcript for updated guidance on the Federal Civilian segment growth by the end of the month.

Profitability Metrics

You want to know if CACI International Inc (CACI) is making money efficiently, and the short answer is yes, its profitability is strong and improving, especially when you look at how well they manage their core operations.

The company closed its fiscal year 2025 (FY2025) with annual revenue of nearly $8.63 billion, an increase of 12.6% year-over-year. This top-line growth is translating directly to the bottom line, which is what we want to see. Net income for the year was approximately $0.50 billion, a 19.0% increase from the prior year. This tells us CACI is not just growing revenue, but also successfully converting that revenue into profit.

Here's the quick math on CACI's key profitability margins for FY2025:

• Gross Profit Margin: 8.8% ($0.76 billion Gross Profit / $8.63 billion Revenue)
• Operating Profit Margin: 8.9% ($0.76 billion Operating Income / $8.63 billion Revenue)
• Net Profit Margin: 5.8% ($0.50 billion Net Income / $8.63 billion Revenue)

The gross profit margin and operating profit margin are very close, which is typical for a professional services firm where the cost of services (salaries, subcontracts) is the primary cost of goods sold, and general administrative overhead is relatively low. This is a lean operating structure.

Trends and Operational Efficiency

The trend is defintely positive. CACI's margins have been steadily climbing, with the operating margin improving to 8.9% in FY2025 from 8.5% in FY2024. This growth is a direct result of operational efficiency, not just higher sales volume. They are getting more profit out of every dollar of revenue. Income from operations increased by 17.6% in FY2025, outpacing the 12.6% revenue growth, which is a clear sign of effective cost management and a shift toward higher-value contracts.

One concrete sign of this efficiency is the reduction in direct costs as a percentage of revenue, which dropped to 67.6% from 68.8% a year earlier. That's a measurable improvement in cost control. CACI is focused on high-value digital contracts, like those in cyber and AI, which generally carry better pricing power and contribute to this margin expansion.

Benchmarking Against the Industry

When you compare CACI to its peers in the government services and defense IT sector, its margins are competitive, sitting comfortably in the middle to upper range of the peer group. The industry average operating margin for this sector is often cited around 6.2%.

CACI's 8.9% operating margin is significantly above that industry average, showing a clear competitive advantage in their contract execution and cost structure. However, it is not the highest, which is fine-you don't want the highest margin in this space; you want a sustainable one.

For context, here is how CACI's operating margin stacks up against some major competitors:

Leidos and Booz Allen Hamilton are slightly higher, but CACI's margin is still strong and growing faster. This suggests CACI's strategy of focusing on recurring, mission-critical work and strategic acquisitions is working to absorb cost pressures better than many peers. If you want to dive deeper into the market's view of CACI's stock, you should be Exploring CACI International Inc (CACI) Investor Profile: Who's Buying and Why?

The action item here is to monitor the operating margin trend: if it continues to expand toward the 10% mark, it will signal a significant shift in their business mix toward even higher-value technology services.

Debt vs. Equity Structure

You need to know how CACI International Inc (CACI) funds its substantial growth, and the short answer is through a calculated mix of debt and equity, leaning on its stable government contracts to support its borrowing. The company's financial leverage, measured by its Debt-to-Equity (D/E) ratio for fiscal year (FY) 2025, sits at 0.86, signaling a moderate, though elevated, reliance on debt to finance its operations and strategic acquisitions.

For the fiscal year ended June 30, 2025, CACI International Inc's total debt load was composed of both short-term and long-term obligations. This debt structure supports a business model built on consistent, long-cycle government contracts, which provides the predictable cash flow needed to service the debt.

• Short-term debt (current portion of long-term debt) was $68.750 million.
• Long-term debt, net of the current portion, stood at $2,849.190 million.

Here's the quick math: Total debt (including capital lease obligations) was approximately $3.34 billion, against total shareholders' equity of $3,893.945 million.

The resulting D/E ratio of 0.86 means CACI International Inc has 86 cents of debt for every dollar of shareholder equity. To be fair, a D/E ratio below 1.0 or 1.5 is often seen as healthy in many capital-intensive industries. Still, for the government services sector, which typically values lower leverage, this ratio is considered high, having increased from previous years as the company pursues an aggressive acquisition-based growth strategy.

CACI International Inc is defintely active in managing its debt profile. For instance, in a key move on June 2, 2025, the company closed a $1.0 billion upsized offering of 6.375% unsecured senior notes, which mature in 2033. The proceeds from this issuance were strategically used to partially repay amounts outstanding under its revolving credit facility. This is a smart way to lock in a fixed, long-term rate and reduce reliance on potentially more volatile short-term borrowing. This move helps extend the debt maturity profile, reducing near-term refinancing risk.

The company balances its debt financing with equity funding through retained earnings and, occasionally, share repurchases. Their credit rating reflects this balance: S&P Global Ratings affirmed CACI International Inc at 'BB+' (Local Currency Long-Term credit rating) with a stable outlook on September 19, 2025. This non-investment grade rating suggests some risk, but the stable outlook indicates confidence in the company's ability to manage its obligations, especially given its strong operational cash flow.

For a deeper dive into the company's full financial picture, including its valuation and strategic frameworks, you can check out the full post: Breaking Down CACI International Inc (CACI) Financial Health: Key Insights for Investors.

Liquidity and Solvency

CACI International Inc (CACI) maintains a healthy near-term liquidity position, anchored by a strong current ratio and robust operating cash flow, but its aggressive acquisition strategy in fiscal year 2025 (FY2025) required significant debt financing. The key takeaway is that while the company can comfortably cover its short-term obligations, its long-term solvency is being actively managed through a balanced capital deployment strategy.

Assessing CACI International Inc (CACI)'s Liquidity

For FY2025, CACI International Inc (CACI)'s liquidity ratios point to a solid ability to meet its obligations over the next 12 months. The company reported a Current Ratio of 1.47 as of June 30, 2025. This means CACI had $1.47 in current assets for every dollar of current liabilities. This is a defintely comfortable margin, especially for a defense contractor with highly reliable U.S. government receivables.

The Quick Ratio, which excludes inventory (a non-factor for a services company like CACI), is very close to the Current Ratio, indicating high-quality current assets that are easily converted to cash. Here's the quick math for the components, based on Current Assets of approximately $1.78 billion and Current Liabilities of $1.21 billion for the fiscal year ending June 2025:

• Current Assets: $1.78 billion
• Current Liabilities: $1.21 billion
• Current Ratio: 1.47

This strong liquidity position is further reflected in the company's Working Capital, which stood at $571.84 million at the end of FY2025. This figure represents the capital available for day-to-day operations and future growth investments after covering all short-term debts. Management has explicitly cited 'strong working capital management' as a driver of cash flow performance throughout the year.

Cash Flow Statements Overview and Trends

A look at the cash flow statement for CACI International Inc (CACI) in FY2025 reveals a clear strategic narrative: strong operational performance funding an aggressive investment phase, which was then balanced by a significant financing action. All figures are in millions of U.S. Dollars for the year ended June 30, 2025.

Net Cash from Operating Activities (OCF) of $547.01 million is the engine of the business, showing the core operations are highly profitable and cash-generative. The large negative Investing Cash Flow (ICF) of -$1,758.94 million is not a sign of weakness, but a direct result of the company's strategy to expand its capabilities through acquisitions, which is a common growth lever for defense/technology contractors. This is an investment in future growth, not a drain on core resources.

The resulting Financing Cash Flow (FCF) of $1,177.88 million shows the debt capital used to fund this investment. This points to a deliberate trade-off: using debt to fuel growth-oriented acquisitions. For more on the company's long-term direction, review the Mission Statement, Vision, & Core Values of CACI International Inc (CACI).

Potential Liquidity Concerns or Strengths

The primary strength is the quality of the cash flow. CACI International Inc (CACI)'s cash flow from operations is robust and improving, which is the best defense against any short-term market volatility. The company's focus on well-funded national security priorities gives its revenue and cash flow a high degree of predictability. The high current ratio of 1.47 confirms the operational strength translates into a sound balance sheet.

The main point of caution is the jump in debt to finance the acquisitions, as reflected in the large Financing Cash Flow inflow. While the company's balance sheet is strengthening overall, this increase in leverage needs to be monitored. The success of the acquired entities must generate enough future cash flow to justify the debt load and maintain the current Debt/Equity ratio, which was 0.80 as of the most recent data. This is an acceptable level for a company in a growth phase, but it's the key risk to track.

Valuation Analysis

You're looking at CACI International Inc (CACI) right now and asking the core question: is the market pricing this defense and IT services powerhouse correctly? The quick answer is that while the stock has seen a massive run-up, key valuation metrics suggest it's trading at a premium, moving it into the 'overvalued' end of its historical range, but analysts still see room to run. The market is defintely pricing in strong future growth, especially given the government's consistent demand for their high-end solutions.

For the fiscal year 2025 (FY2025), CACI International Inc (CACI) reported robust adjusted diluted earnings per share (EPS) of $26.48 on annual revenue of $8.6 billion. [cite: 17 from first search] This strong performance is the foundation for the current valuation multiples, which are higher than the company's historical averages.

Is CACI International Inc (CACI) Overvalued or Undervalued?

To gauge the valuation, we look at the core multiples. The trailing twelve-month (TTM) Price-to-Earnings (P/E) ratio as of November 2025 stands at 26.13. This is a premium compared to the forward P/E ratio of 20.1 based on fiscal year 2026 (FY2026) earnings estimates. [cite: 1 from first search] The market is expecting a significant jump in earnings, which compresses the forward P/E, but even at 26.13, the TTM ratio suggests a rich valuation for a government contractor.

Here's the quick math on the enterprise value multiple. The Enterprise Value-to-EBITDA (EV/EBITDA) ratio is sitting at 15.85x on a TTM basis. This is higher than the average for many of its industry peers, which often hover closer to the 10x to 12x range. A high EV/EBITDA multiple signals that investors are willing to pay a premium for the company's core operating cash flow (EBITDA), anticipating continued, reliable growth from its defense and intelligence contracts.

Stock Performance and Analyst Consensus

The stock price trend over the last 12 months tells a clear story of momentum. CACI International Inc (CACI) has a 52-week price range of $318.60 to $599.78, [cite: 14 from first search, 7] and the stock has delivered a change of over 31% in the past year, with a recent closing price near $590.83 in mid-November 2025. [cite: 13 from first search, 7] That's a strong upward trajectory, driven by solid contract wins and better-than-expected earnings.

The analyst community is largely bullish, which supports the current high price. The consensus rating is a 'Moderate Buy' or 'Strong Buy.' [cite: 2 from first search, 4 from first search, 7 from first search] The average 12-month price target is in the range of $606.75 to $658.91, with a high target reaching $759.00. [cite: 2 from first search, 7 from first search] What this estimate hides is the potential for government budget delays, but the trend is clear: the Street believes the stock is not done climbing.

• Stock has surged over 31% in the last 52 weeks.
• Analyst consensus is 'Strong Buy' or 'Moderate Buy.' [cite: 4 from first search, 6 from first search]
• Average price target suggests an upside of around $60 to $70 per share from current levels. [cite: 2 from first search, 7 from first search]

Dividend Policy and Capital Allocation

If you're looking for income, CACI International Inc (CACI) is not your play. The company does not currently pay a dividend, [cite: 8 from first search, 12 from first search] meaning the dividend yield and payout ratio are both 0.00%. [cite: 3 from first search] Instead of dividends, management prioritizes capital allocation toward share repurchases and strategic acquisitions to fuel growth, which is typical for a company focused on expanding its market share and technology portfolio. This approach supports the higher P/E and EV/EBITDA multiples by focusing on capital appreciation rather than income distribution.

For a deeper dive into their long-term strategy, you should review their Mission Statement, Vision, & Core Values of CACI International Inc (CACI).

Next Step: Review the company's latest contract awards, particularly in the classified and high-tech areas, to see if the growth assumptions baked into that 20.1 forward P/E are justified.

Risk Factors

You need to understand the core risks facing CACI International Inc (CACI) because they map directly to its primary customer: the U.S. government. The company's financial health is intimatley tied to the federal budget cycle and its ability to win and execute complex, high-margin contracts. Simply put, budget uncertainty is the biggest headwind.

The most significant financial risk is CACI International Inc's reliance on federal contracts, which account for approximately 95% of its annual revenues. This concentration means any shift in government spending priorities, budget cuts, or significant delays in appropriations-like those caused by continuing resolutions-can immediately impact its top line. For instance, a major change in policy from a new presidential administration could result in economic uncertainty and contract delays.

Operational and strategic risks are also a constant factor in this sector. Here's the quick math: CACI International Inc's total backlog was a strong $31.4 billion as of June 30, 2025, but winning new work is a perpetual challenge.

• Competitive Bidding: The competitive landscape is fierce, with major rivals like Leidos and Booz Allen Hamilton. CACI International Inc faces vulnerability to contract protests and intense pricing pressures.
• Talent War: Recruiting and retaining employees, especially those with high-level security clearances, is a defintely operational risk in a tight labor market.
• Acquisition Integration: The company relies on strategic mergers and acquisitions (M&A) to bolster capabilities, but integrating these new assets carries inherent operational risks.

To be fair, CACI International Inc is actively mitigating these risks. Strategically, they are pivoting toward higher-margin, differentiated offerings like C5ISR (Command, Control, Computers, Communications, Cyber, Intelligence, Surveillance, and Reconnaissance) and secure agile software. This focus on classified, high-barrier programs provides a technical moat against general competition.

From a capital management perspective, the company is using its strong cash flow for both strategic M&A and returning capital to shareholders. In fiscal year 2025, CACI International Inc executed $150 million of open market share repurchases, demonstrating confidence in its valuation and a commitment to boosting earnings per share (EPS). This dual approach helps manage capital while focusing on long-term, differentiated growth. You can dive deeper into who is betting on this strategy in Exploring CACI International Inc (CACI) Investor Profile: Who's Buying and Why?.

Here is a summary of the key financial metrics from the fiscal year 2025 results, which underpin the company's ability to manage these risks:

The bottom line is that CACI International Inc's strong financial performance in FY2025-with revenues of $8.6 billion and a 12.6% year-over-year increase-gives it the flexibility to weather government-related budget fluctuations and invest in the high-demand technology sectors that will drive future contract wins.

Growth Opportunities

You're looking for a clear path through CACI International Inc (CACI)'s future, and the takeaway is simple: the company is positioned to capitalize on non-negotiable US government spending in high-tech, classified domains. This isn't just about winning more of the same contracts; it's a pivot to higher-margin, technology-driven work that's already showing up in their financial results.

Here's the quick math: CACI International Inc's total revenue for fiscal year 2025 was a strong $8.6 billion, representing a 13% year-over-year increase, with organic growth alone coming in at 7.2%. This momentum is expected to continue, with management guiding for fiscal year 2026 revenue between $9.2 billion and $9.4 billion. That defintely gives you a clear runway.

Key Growth Drivers: Technology and M&A

The core of CACI International Inc's growth strategy is aligning its capabilities with the government's most critical and well-funded priorities-think cyber, space, and the electromagnetic spectrum (EMS). The company's strategic shift focuses on delivering differentiated technology rather than just staff augmentation, and this is what drives higher profitability.

• Product Innovations: CACI International Inc is investing heavily in advanced technologies like AI/machine learning, cybersecurity, and data analytics, which are essential for the government's digital transformation efforts. They also have a technical lead in SIGINT payloads and tactical communications.
• Strategic Acquisitions: Acquisitions are a key lever for instantly boosting capability. The integration of companies like Azure Summit Technology (focused on high-performance radio frequency technology) and Applied Insight in FY25 solidified CACI International Inc's position in the electromagnetic spectrum and cloud markets.
• Strategic Partnerships: They're not building everything in-house. A partnership with GitLab, for example, is central to their adoption of the DevSecOps (Development, Security, and Operations) software methodology, allowing for faster, more secure software development for their government clients.

The market opportunity is huge. CACI International Inc operates in an addressable federal services market estimated to be around $200-230 billion, focusing on defense, intelligence, and homeland security. You can read more about their philosophical approach here: Mission Statement, Vision, & Core Values of CACI International Inc (CACI).

Financial Projections and Competitive Edge

The financial forecasts reflect the success of this high-value, tech-focused strategy. Adjusted diluted earnings per share (EPS) for FY25 hit $26.48, an impressive 26% jump year-over-year. For FY26, the company expects this to grow to between $27.13 and $28.03 per share. This is a strong signal of margin expansion and efficient capital management.

The sheer scale of their contracted work provides exceptional revenue visibility. Total backlog as of June 30, 2025, stood at $31.4 billion. Plus, their competitive advantages are structural, not fleeting:

What this estimate hides is the risk of US budget volatility, which can delay contract awards. Still, CACI International Inc's focus on mission-critical, classified work makes it more resilient than many peers. Your next step should be to monitor the Q2 2026 contract award announcements for new business wins in the space and cyber domains.