Leidos Holdings, Inc. (LDOS)

The customer is federal agencies, the defence department and the intelligence community. Contracts are long, often five years or more, and the work requires staff with security clearances. That is a barrier in itself: a new contractor does not appear quickly, even offering a lower price.

Revenue is predictable, but the growth ceiling is set by the federal budget rather than by a market. Distinct lines are screening equipment, which the company sells outright, and medical examinations for veterans. Risks: government funding lapses, contract recompetes and customers shifting to outcome-based payment. The dividend is small and buybacks are active.