What Happened?
Shares of government consulting firm Booz Allen Hamilton (NYSE: BAH) jumped 2.9% in the afternoon session after President Donald Trump called for a significant increase in U.S. military spending, which lifted the entire defense sector.
The proposal aimed to raise the U.S. military budget to $1.5 trillion by 2027, representing a substantial increase from the existing $901 billion. This news prompted a broad rally across the defense industry, with major contractors like Lockheed Martin and Northrop Grumman also experiencing significant gains. The move marked a sharp reversal from the previous day, when stocks in the sector fell after Trump criticized contractors for slow production and threatened to block their dividends and stock buybacks. Investors appeared to set aside those earlier concerns, focusing instead on the potential for a large boost in government spending.
After the initial pop the shares cooled down to $93.38, up 3.5% from previous close.
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What Is The Market Telling Us
Booz Allen Hamilton’s shares are somewhat volatile and have had 11 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 23 days ago when the stock dropped 6.9% on the news that the company announced that its Chief Financial Officer, Matthew Calderone was resigning. The resignation was set to be effective February 1, 2026. According to a regulatory filing, Calderone informed the company of his decision on December 11, 2025, stating he was leaving to pursue an opportunity outside of the industry. The unexpected change in a key leadership position appeared to unsettle investors. In response to the news, Booz Allen Hamilton began a search for a new chief financial officer.
Booz Allen Hamilton is up 10% since the beginning of the year, but at $93.38 per share, it is still trading 34.7% below its 52-week high of $143.06 from January 2025. Investors who bought $1,000 worth of Booz Allen Hamilton’s shares 5 years ago would now be looking at an investment worth $1,019.
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