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Investing.com — ManTech International (NASDAQ:MANT) shares rallied 6.9% Friday following upgrades by analysts at William Blair and BofA. The upgrades come on the back of reports Thursday that co-founder George Pedersen is exploring options for the sale of his controlling stake.
Rumors and reports swirled that a sale of the defense contracting firm is being explored, with private equity firms and strategic buyers contacted by investment bank Goldman Sachs.
Reports from StreetInsider stated Pederson — aged 86, who owns all 13.2 million Class B shares outstanding and controls approximately 83% of the voting power, is considering his options as the shares won’t have voting control should he pass away.
The news prompted BofA analyst Mariana Perez Mora to double upgrade the shares from underperform to buy, increasing the firm’s price target to $90 from $75. Mora said the dual-class ownership structure had limited ManTech’s upside. However, Pederson’s change in approach “opens meaningful strategic options for the company that before were not possible, more than offsetting near term headwinds from slow defense/intel award environment, higher than normal re-compete risk, and lower than anticipated win rate within federal civil.”
In addition, William Blair analyst Louie DiPalma upgraded the stock to outperform. As well as the potential sale, the analyst cited the company’s two recent Navy contract wins as reasons for the re-rating. DiPalma said with shares now at $75, the risk-to-reward looks favorable.
