Parsons Corp
NYSE:PSN
Parsons Corp
Parsons Corporation, an established name in the consulting and engineering services sector, began its journey in the mid-20th century, evolving from a regional player to a global powerhouse. Headquartered in Centreville, Virginia, the company is a testament to adept diversification, primarily focusing on defense, intelligence, and critical infrastructure. Over the decades, Parsons has pivoted to address the burgeoning needs of cybersecurity, intelligent network solutions, and cutting-edge technological systems. The critical lens through which Parsons operates is one that combines traditional engineering practices with high-tech, systems-based solutions to cater to the dynamic needs of both government and commercial clients.
At its core, Parsons makes money by strategically blending traditional engineering expertise with advanced technological solutions. This dual focus allows it to capture a broad spectrum of projects - from designing and constructing infrastructure like bridges and tunnels to providing intricate cyber defense systems and threat detection for national security. The company's revenue streams are bolstered by long-term contracts with governmental bodies, ensuring a stable cash flow. Meanwhile, its investments in tech innovations secure its position in competitive markets. By bridging engineering with technology, Parsons not only adapts to changing market demands but also anticipates future challenges, ensuring its longevity and relevance in a rapidly evolving world.
Parsons Corporation, an established name in the consulting and engineering services sector, began its journey in the mid-20th century, evolving from a regional player to a global powerhouse. Headquartered in Centreville, Virginia, the company is a testament to adept diversification, primarily focusing on defense, intelligence, and critical infrastructure. Over the decades, Parsons has pivoted to address the burgeoning needs of cybersecurity, intelligent network solutions, and cutting-edge technological systems. The critical lens through which Parsons operates is one that combines traditional engineering practices with high-tech, systems-based solutions to cater to the dynamic needs of both government and commercial clients.
At its core, Parsons makes money by strategically blending traditional engineering expertise with advanced technological solutions. This dual focus allows it to capture a broad spectrum of projects - from designing and constructing infrastructure like bridges and tunnels to providing intricate cyber defense systems and threat detection for national security. The company's revenue streams are bolstered by long-term contracts with governmental bodies, ensuring a stable cash flow. Meanwhile, its investments in tech innovations secure its position in competitive markets. By bridging engineering with technology, Parsons not only adapts to changing market demands but also anticipates future challenges, ensuring its longevity and relevance in a rapidly evolving world.
Strong Revenue Growth: Total revenue grew 12% for the year and 11% in Q4, with organic growth of 8% excluding the confidential contract.
Margin Expansion: Adjusted EBITDA margin reached a record 9.6%, up 60 basis points year-over-year, with Critical Infrastructure margins hitting 10.6% in Q4.
Cash Flow Strength: Free cash flow conversion was 100%, and full-year operating cash flow exceeded guidance.
Contract Wins & Backlog: Secured multiple large contracts over $100 million, with total backlog at $8.7 billion and funded backlog at a record $6.4 billion.
Guidance & Outlook: 2026 revenue guidance set at $6.5–$6.8 billion, with 4.5% growth at the midpoint; adjusted EBITDA guidance of $615–675 million and margin expansion targeted.
Federal Solutions Headwinds: Segment faced headwinds from a large confidential contract winding down and a government shutdown, but management expects improved book-to-bill in 2026.
Acquisition Activity: Completed three acquisitions in 2025 and one in early 2026, supporting growth and margin expansion.
Medium-Term Targets: Reaffirmed mid-single digit organic growth, pursuit of double-digit margins by 2028, and 100%+ cash flow conversion.
