Parsons to Snap Up BlackHorse for $203M; Street Remains Cautiously Optimistic

Parsons (PSN) has agreed to acquire BlackHorse Solutions, a digital security firm that creates and delivers advanced technology and tradecraft solutions. Parsons Corporation is a technology-focused defense, intelligence, security, and infrastructure engineering company.

The deal is valued at $203 million and is expected to close in July, subject to customary closing conditions.

The move is expected to enhance Parsons’ portfolio of next-generation military, intelligence, and space operations. Furthermore, the buyout will expand the company’s capabilities in cyber, digital operations, artificial intelligence, and other verticals.

Parson CEO Chuck Harrington said, “Adding BlackHorse increases our scale in the areas of cyber, electronic warfare, and information dominance, enhancing Parsons’ position to pursue and win upcoming large joint all-domain contract opportunities, which is a key component of our national defense strategy.”

He added, “We have partnered with BlackHorse in the past, so we know our cultures are well-aligned. We are excited to welcome their talented team of employees to the Parsons’ family and leverage their exceptional reputation in the market.” (See Parsons stock analysis on TipRanks)

On May 7, Cowen & Co. analyst Cai Rumohr reiterated a Hold rating on the stock but increased his price target to $43 from $33. This implies 8.2% upside potential from current levels.

Rumohr said, “On track Q1 doesn’t change PSN’s flattish 2021 outlook, but sales should pick up in 2022.”

The rest of the Street is cautiously optimistic about the stock with a Moderate Buy consensus rating based on 2 Buys and 2 Holds. The PSN average analyst price target of $50.50 implies 27.1% upside potential from current levels. Shares have increased 9.6% over the past six months.

Parsons scores a 7 of 10 on TipRanks’ Smart Score rating system, indicating that the stock is likely to perform in line with market averages.