Which stocks are most exposed to the 2026 US midterm elections? Government contractors with a high share of federal revenue are natural places to start. Science Applications International Corporation (Nasdaq: SAIC) reported that 98% of FY2026 revenue came from US government contracts; CACI International (NYSE: CACI) reported 95.6%; Leidos Holdings (NYSE: LDOS) reported approximately 87% for FY2025; and Lockheed Martin (NYSE: LMT) reported 72% of FY2025 sales from the US government. Those figures identify business exposure, not the direction of any post-election stock return.3456
November 3, 2026 is election day for all 435 House seats and 35 Senate contests. The immediate financial question is not which party to buy. It is how the next Congress could influence federal appropriations, program priorities and the timing of contract awards. We compared US Securities and Exchange Commission (SEC) filings in Clarifo to separate reported customer concentration from assumptions about future budgets.1
Government revenue dependence is measurable today. The earnings impact of a new Congress depends on which programs are funded, delayed, expanded or reduced.
Why the 2026 midterms matter for government contractor stocks
Congress controls appropriations, while the executive branch proposes priorities and agencies administer procurement. A change in congressional control can affect the size, composition and scrutiny of future budgets. It does not immediately cancel existing federal contracts or determine the next quarter's reported revenue.
There is already a specific funding calendar to monitor. The Continuing Appropriations and Extensions Act, 2027, signed September 2, funds continuing federal activities through December 11, 2026. That deadline arrives before the new Congress convenes in January 2027. Accordingly, decisions made by the outgoing Congress and existing agency leadership can still matter more for near-term procurement than the election result itself.21
For investors in defense and federal IT stocks, the useful questions are narrower: Does an agency receive money for an existing program? Can it start a new project under the current funding arrangement? Does a contractor have funded work already in hand? And how much of a reported backlog depends on optional future orders?
Which public companies depend most on US government revenue?
The following are company-reported annual shares of total consolidated revenue or sales from the US federal government, including disclosed prime and subcontract relationships where applicable. The figures are drawn from different fiscal years. The table shows fiscal labels and month/day to keep the layout readable; full year-end dates appear in the cited filings. We retain each issuer's period rather than presenting them as a synchronized 2026 dataset.
SAIC and CACI percentages: FY2026. Leidos and Lockheed Martin percentages: FY2025. Sources and company-specific fiscal year ends are linked in the table below. Booz Allen excluded because its cited FY2026 report does not quantify 'substantially all' as a percentage.
| Company | US government share | Reporting period |
|---|---|---|
| SAIC (SAIC)3 | 98% | FY2026 · Jan 30 |
| CACI International (CACI)4 | 95.6% | FY2026 · Jun 30 |
| Leidos (LDOS)5 | ~87% | FY2025 · Jan 2 |
| Lockheed Martin (LMT)6 | 72% | FY2025 · Dec 31 |
| Booz Allen Hamilton (BAH)7 | Substantially all | FY2026 · Mar 31 |
Company definitions and year-ends differ. Percentages are shares of reported revenue, not percentages of federal appropriations; a subcontract can count as government-derived revenue without being a direct federal agency sale. Booz Allen is excluded from the percentage chart because its cited FY2026 disclosure states "substantially all" rather than a directly comparable numerical share.
Booz Allen Hamilton Holding Corporation (NYSE: BAH) illustrates the concentration beyond a headline percentage. Its FY2026 Form 10-K states that substantially all revenue came from US government contracts and task orders, with funding linked to the spending patterns of federal agencies. Its risk disclosure identifies shutdowns and procurement disruption as business risks.78
The broad label "government contractor" also conceals very different exposures. Lockheed Martin produces large defense systems, while SAIC, Booz Allen, CACI and Leidos provide varying combinations of IT, engineering, intelligence, cybersecurity and mission support. A budget change targeted at a particular agency or program can therefore affect two contractors with similar federal revenue shares in very different ways.
What the latest Q2 and Q3 2026 earnings actually show
The concentration figures above are annual snapshots. For the earnings picture closest to election day, the more useful comparison is each company's latest reported standalone quarter against the same quarter one year earlier. As of November 3, 2026, September-quarter results are available for Booz Allen Hamilton, CACI, Lockheed Martin and Palantir. SAIC's most recent published results cover the quarter ended July 31, while Leidos's latest confirmed earnings cover July 3. The fiscal quarter labels differ because these companies do not share a fiscal calendar.1415161718
| Company | Quarter ended | Revenue, USD bn | YoY |
|---|---|---|---|
| Booz Allen Hamilton14 | Sep 30, 2026 FY2027 Q2 | 2.778 | −3.9% |
| CACI International15 | Sep 30, 2026 FY2027 Q1 | 2.475 | +8.2% |
| Lockheed Martin16 | Sep 27, 2026 2026 Q3 | 20.711 | +11.3% |
| SAIC17 | Jul 31, 2026 FY2027 Q2 | 1.880 | +6.3% |
| Leidos18 | Jul 3, 2026 2026 Q2 | 4.558 | +7% |
| Palantir12 | Sep 30, 2026 2026 Q3 | 2.313 | +96% |
Each row compares the stated quarter with that company's same fiscal quarter in 2025. Booz Allen, CACI and Lockheed Martin growth is calculated from reported comparative revenue; SAIC, Leidos and Palantir growth follows the issuer's published rounded rate. Reporting dates and businesses differ. Palantir's software growth should not be interpreted as directly comparable to a defense contractor's program-based growth.
There is a meaningful divergence even among the most government-dependent names. Booz Allen's September-quarter revenue declined from $2.890 billion to $2.778 billion, while CACI's increased from $2.288 billion to $2.475 billion. The spread is not evidence of a midterm election effect; both quarters ended before voting, and contract-specific changes explain far more than a political label.1415
Lockheed Martin reported $20.711 billion of third-quarter 2026 sales against $18.609 billion a year earlier. Its October 22 release also disclosed a $292.0 billion backlog, compared with $193.6 billion at December 31, 2025. The newer total includes $52.5 billion associated with a multiyear PAC-3 Missile Segment Enhancement award. Backlog is not cash and does not imply all options or future work are immediately funded.1611
The latest customer-mix disclosures also show that federal exposure can shift without a change in party control. Leidos reported 83% of July-quarter 2026 revenue from US government contracts, compared with 87% in the July 2025 quarter. CACI's September 2026 quarter was 54.8% defense, 24.7% intelligence and 16.0% civilian federal agencies, leaving 4.5% from commercial and other customers. That breakdown is more actionable for a policy scenario than a single federal-revenue total.1915
Leidos has scheduled its Q3 2026 earnings announcement and conference call for November 3 at 8 a.m. US Eastern time, so a pre-release election-day analysis should not assign Q3 figures to it. Refresh Leidos when the official release becomes available.20
Five channels through which congressional decisions reach earnings
Defense authorizations versus actual appropriations
Defense policy can establish priorities, but spending authority and timing still depend on enacted appropriations and the conditions attached to them. For companies such as Lockheed Martin, the risk is not simply whether political discussion favors defense. Investors should follow individual aircraft, missile, space and sustainment programs, their funded orders and expected production schedules.6
Civilian agency IT and consulting procurement
SAIC, Booz Allen, CACI and Leidos also serve civilian agencies. Changes to technology modernization, digital services, cybersecurity, healthcare administration or agency headcount may affect the volume and mix of future work. A shift toward efficiency-driven contracting could favor one provider while reducing another provider's labor-intensive program activity.37
Contract awards, renewals and option periods
Federal contractors often operate through multiyear agreements, indefinite-delivery vehicles and task orders. A contract's ceiling value does not mean every optional dollar is funded or guaranteed to become revenue. Evaluate funded backlog, remaining performance obligations, exercise of options and the pace of new awards separately.711
Continuing resolutions and shutdown risk
Temporary funding can extend existing operations while complicating the start of new programs. Delayed awards, interrupted agency work, changes in subcontractor utilization and payments can affect revenue timing and cash flow. SAIC explicitly discusses government spending priorities and funding interruptions in its annual disclosures.3
Contract pricing and margin mix
Even when federal revenue holds steady, a changed mix between fixed-price, cost-reimbursement and time-and-materials work can alter profit margins and risk allocation. An investor comparing contractors should therefore inspect operating income and cash conversion alongside revenue exposure, instead of treating every government dollar as equally profitable.7
Palantir offers a different case: government growth alongside commercial diversification
Palantir Technologies (NASDAQ: PLTR) released its third-quarter 2026 results on November 2, one day before election day. Its SEC-filed earnings release reported $953 million of US government revenue, up 96% year over year, and $984 million of US commercial revenue, up 148%. US commercial revenue exceeded US government revenue for the first time.12
This is why Palantir should not be inserted into the same chart without care. The other percentages are US government revenue divided by worldwide company revenue for full fiscal years. Palantir's newly reported numbers compare US government revenue with US commercial revenue for one quarter; they are not the same denominator. In its earlier Form 10-Q, Palantir also warned that government spending priorities and procurement delays could affect its prospects.1213
Palantir's case shows that federal contract demand can grow rapidly at the same time as a company's business mix shifts toward commercial customers. Whether that reduces investment risk depends on more than a single quarter of sales; investors also need to examine contract duration, concentration, margins and cash generation.
What investors should monitor after November 3
The election result is one input, not a forecast. The practical watchlist is the December 11, 2026 funding deadline, the subsequent fiscal 2027 appropriations process, major procurement announcements, and each contractor's next reported book-to-bill, funded backlog, operating margins and operating cash flow.2
A constructive case would involve stable funding and faster awards in programs where a contractor already has qualified capacity. A downside case could combine prolonged temporary funding, a narrower agency budget and slower option exercises. A mixed outcome is also plausible: defense priorities may improve while selected civilian programs contract, or the reverse. None of those scenarios follows mechanically from a party label.
Continue the government contractor comparison in Clarifo
We built Clarifo to connect company financials with the filings behind them. You can use the Clarifo platform to inspect SAIC, CACI, Leidos, Lockheed Martin, Booz Allen and Palantir, compare reported revenue and margins, and trace risk disclosures to their SEC sources. For a deeper follow-up, distinguish federal exposure from funded backlog, contract mix and historical cash conversion.
You can also bring this research into ChatGPT or Claude using Clarifo's AI integration. After connecting the Clarifo app or MCP server, try asking: "Compare BAH, SAIC, CACI, LDOS and LMT using their latest reported revenue growth and operating margins. Find each company's disclosures on federal budget uncertainty and identify which conclusions rely on fiscal-year periods that do not align. Cite the original filings." For setup guidance, see our MCP documentation.
Build your own government contractor comparison
Use Clarifo on the web or connect it to ChatGPT and Claude to test different federal spending scenarios against reported revenue, cash flow and source-linked risk disclosures.
- [1] Bipartisan Policy Center, The 2026 Midterms: Key Dates and Events. Election date, contests and new Congress timing.
- [2] The White House, Continuing Appropriations and Extensions Act, 2027 (September 2, 2026). Temporary funding through December 11, 2026.
- [3] SAIC, FY2026 Form 10-K, Item 7 (year ended January 30, 2026). US government share, fiscal revenue and funding risk.
- [4] CACI, FY2026 Form 10-K, Item 1A. Federal government revenue share of 95.6%.
- [5] Leidos, FY2025 Form 10-K, government customer risk discussion. Approximately 87% government share.
- [6] Lockheed Martin, FY2025 Form 10-K, Item 1A. US government share of 72% and defense budget sensitivity.
- [7] Booz Allen Hamilton, FY2026 Form 10-K, Item 7. Government contracts, contract structure and revenue mix.
- [8] Booz Allen Hamilton, FY2026 Form 10-K, Item 1A. Agency disruption and shutdown risks.
- [9] Booz Allen Hamilton, FY2026 Form 10-K, Item 7 financial results. Revenue for FY2026 and FY2025.
- [10] CACI, FY2026 Form 10-K, Item 7 financial results. Revenue for FY2026 and FY2025.
- [11] Lockheed Martin, FY2025 Form 10-K, Item 7 backlog. Backlog of $193.6 billion at year-end 2025.
- [12] Palantir, Q3 2026 earnings release filed as SEC Exhibit 99.1, November 2, 2026. US government and commercial revenue.
- [13] Palantir, Q2 2026 Form 10-Q, Part II Item 1A. Government funding and procurement risk.
- [14] Booz Allen Hamilton, FY2027 Q2 Form 10-Q, quarter ended September 30, 2026. Revenue of $2.778 billion versus $2.890 billion in Q2 FY2026.
- [15] CACI, FY2027 Q1 Form 10-Q, quarter ended September 30, 2026. Revenue of $2.475 billion, up 8.2%, and government customer mix.
- [16] Lockheed Martin, Q3 2026 earnings release, SEC Exhibit 99.1, October 22, 2026. Sales of $20.711 billion versus $18.609 billion, plus updated backlog.
- [17] SAIC, FY2027 Q2 earnings release, August 31, 2026. Revenue of $1.880 billion and reported year-over-year growth of 6.3%.
- [18] Leidos, Q2 2026 earnings release, August 4, 2026. Revenue of approximately $4.558 billion and growth of approximately 7%.
- [19] Leidos, Q2 2026 Form 10-Q, government customer mix. US government share of 83% in the July 2026 quarter versus 87% year earlier.
- [20] Leidos, Q3 2026 earnings announcement schedule, October 6, 2026. Planned November 3, 2026 release and call.
Method. Clarifo Research compared company-reported SEC revenue and customer concentration disclosures. Shares are reproduced as reported rather than recomputed from inferred agency budgets. Quarterly year-over-year growth compares standalone latest quarters against each issuer's corresponding prior-year quarter; calculated growth is shown to one decimal place and issuer-rounded growth is identified where used. Fiscal years, reporting dates and definitions differ across issuers. The comparison is descriptive and does not model the probability, timing or outcome of federal policy decisions.
Research cut-off: November 3, 2026, before US midterm election results and before the scheduled Leidos Q3 earnings release. Educational company analysis, not personalized investment advice. Election and budget outcomes are uncertain.