In a sliding market, Amentum has defied the odds, trading up to $26.73 per share. Its 18.3% gain since September 2025 has outpaced the S&P 500’s 1.9% drop. This performance may have investors wondering how to approach the situation.
Is now the time to buy Amentum, or should you be careful about including it in your portfolio? See what our analysts have to say in our full research report, it’s free.
Why Is Amentum Not Exciting?
We’re happy investors have made money, but we're cautious about Amentum. Here are three reasons you should be careful with AMTM and a stock we'd rather own.
1. Long-Term Revenue Growth Disappoints
A company’s long-term sales performance is one signal of its overall quality. Any business can have short-term success, but a top-tier one grows for years. Regrettably, Amentum’s sales grew at a tepid 3.1% compounded annual growth rate over the last three years. This was below our standard for the business services sector.
2. Projected Revenue Growth Shows Limited Upside
Forecasted revenues by Wall Street analysts signal a company’s potential. Predictions may not always be accurate, but accelerating growth typically boosts valuation multiples and stock prices while slowing growth does the opposite.
Over the next 12 months, sell-side analysts expect Amentum’s revenue to stall, a slight deceleration versus its 3.1% annualized growth for the past three years. This projection doesn't excite us and implies its products and services will face some demand challenges.
3. EPS Trending Down
We track the long-term change in earnings per share (EPS) because it highlights whether a company’s growth is profitable.
Sadly for Amentum, its EPS declined by 41.3% annually over the last three years while its revenue grew by 3.1%. This tells us the company became less profitable on a per-share basis as it expanded.
Final Judgment
Amentum isn’t a terrible business, but it doesn’t pass our bar. With its shares topping the market in recent months, the stock trades at 10.9× forward P/E (or $26.73 per share). While this valuation is reasonable, we don’t really see a big opportunity at the moment. We're pretty confident there are more exciting stocks to buy at the moment. We’d suggest looking at our favorite semiconductor picks and shovels play.
Stocks We Would Buy Instead of Amentum
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