Parsons Corporation (PSN) stock climbed Wednesday after scoring an $88 million air defense contract that reinforces its role protecting U.S. military installations in Europe.
The single-award task order will support base air defense systems at U.S. Air Forces in Europe – Air Forces Africa (USAFE-AFAFRICA) at Ramstein Air Base in Germany. It's a three-year commitment that expands Parsons' existing work under the broader ABAD program, bringing the company's 2025 total value under ABAD to roughly $192 million.
Following the announcement, TD Cowen's Gautam Khanna upgraded Parsons to Buy from Hold. Interestingly, he also trimmed his price forecast to $75 from $90, suggesting the upgrade reflects improving fundamentals rather than outsized optimism.
What Parsons Will Actually Do
Under the task order, Parsons will handle hardware procurement and configuration, integrate systems, provide specialized training for operators, supply technical support, and maintain systems. The work is designed to ensure operational readiness, long-term reliability, and robust air base security capabilities.
"Our success on the ABAD mission draws from our team's experience and proven track record," said Mike Kushin, president of Defense and Intelligence for Parsons. The task order also reinforces the firm's "commitment to delivering cutting-edge technology solutions and expert support."
Parsons views the award as validation of its leadership in safeguarding U.S. air bases overseas, which makes sense given the geopolitical backdrop. With tensions in Europe remaining elevated, fortifying air defense systems at key bases like Ramstein has become increasingly critical.
A Track Record in Defense
This isn't Parsons' first rodeo. Back in 2021, the company secured a 10-year indefinite-delivery/indefinite-quantity contract worth $953 million. That longstanding agreement underscores Parsons' established position in national security operations, and this new task order builds on that foundation.
Still, the stock hasn't exactly been rewarding investors lately. PSN stock has lost over 32% in the past year, according to market data. For those looking to gain exposure, the Defiance Drone and Modern Warfare ETF (JEDI) includes Parsons among its holdings.
PSN Price Action: Parsons shares were up 2.06% at $66.50 during premarket trading on Wednesday.