Parsons Plunges 25%: Air Traffic Control Setback Overshadows $3.5B DTRA Win

Summary
• Parsons (PSN) shares cratered 25% to $63.31, erasing nearly $21 of value in a single session.
• FAA’s $10B air traffic control modernization contract awarded to Peraton, not Parsons-IBM joint bid.
• DTRA’s $3.5B CTRIC IV contract secures Parsons’ threat reduction role but lacks immediate revenue guarantees.

Parsons’ historic selloff reflects investor recalibration of its near-term catalysts. While the stock secured a critical defense contract, the loss of the FAA air traffic control bid—a long-anticipated catalyst—triggered a sharp repricing. The session’s $62.55 low underscores the market’s bearish pivot, with technical indicators and options activity amplifying the volatility.

Air Traffic Control Contract Loss Overshadows DTRA Win
The FAA’s decision to award its $10 billion air traffic control modernization contract to Peraton, a Veritas Capital-owned rival, directly triggered the selloff. This outcome negated a key revenue driver that had been priced into Parsons’ stock for months. While Parsons highlighted its 50-year FAA partnership and potential as an implementation partner, the loss of prime contractor status signaled a material shift in market expectations. The DTRA CTRIC IV contract, though strategically significant, is an IDIQ with no guaranteed revenue, failing to offset the immediate blow to investor sentiment.

Aerospace & Defense Sector Mixed as Lockheed Martin Holds Steady
The broader aerospace sector showed resilience, with Lockheed Martin (LMT) up 0.48% despite the selloff. This divergence highlights sector-specific dynamics: while defense contractors like Lockheed benefit from stable government spending, companies reliant on competitive bidding—like Parsons—face sharper volatility. The sector’s mixed performance underscores the importance of contract visibility and pricing power in a high-stakes bidding environment.

Bearish Options Play and Technical Reversal Signals
• 200-day average: 72.87 (well below current price)
• RSI: 47.18 (neutral but trending lower)
• MACD: 0.028 (bullish but weak)
• Bollinger Bands: Price at 63.31, far below the 80.52 lower band

Parsons’ technicals paint a bearish picture, with price action breaking below critical support levels. The 52-week low of $54.56 now looms as a near-term target. For options traders, the PSN20251219P60 and PSN20260116P60 contracts stand out:

• PSN20251219P60
- Strike: $60 | Expiration: 12/19/25 | IV: 67.43% | Leverage: 32.42% | Delta: -0.321 | Theta: -0.042 | Turnover: $19,890
- IV (high volatility) and Leverage (moderate) suggest strong bearish potential. A 5% downside to $59.99 would yield a $0.02 payoff, amplifying returns given the high gamma (0.041).

• PSN20260116P60
- Strike: $60 | Expiration: 1/16/26 | IV: 44.59% | Leverage: 28.10% | Delta: -0.326 | Theta: -0.019 | Turnover: $5,291
- IV (mid-range) and Leverage (modest) balance risk and reward. A 5% drop would trigger a $0.02 payoff, with the longer-dated option offering time decay protection. Both contracts benefit from high gamma and moderate delta, ideal for a short-term bearish play.

Action: Aggressive bears may consider PSN20251219P60 for a 12/19 expiry, while PSN20260116P60 offers a safer, longer-term alternative. Watch for a break below $60 to validate the bearish case.

Backtest Parsons Stock Performance
To run an event-study–style back-test on “–25 % intraday plunges” we first have to pin down exactly how we’ll detect those events from historical data:1. True intraday drawdowns (high → low) require tick / minute data. 2. If we use daily data (open / high / low / close), a practical proxy is: • Event date = any trading day on which the intraday low is at least 25 % below the previous session’s close.I can retrieve PSN’s daily OHLC series from 2022-01-01 to today, identify all dates that meet that criterion, and then run an event back-test to see how the share price behaved after each plunge (average returns, hit ratio, optimal holding horizon, etc.).Please let me know:• Is using the “low vs. previous close ≤ –25 %” rule acceptable for defining the plunge? • Do you want the analysis run on: – Parsons Corp. (NYSE: PSN) -- US ticker, or – Persimmon plc (LSE: PSN) -- UK ticker? (They trade in different time zones and have different quote currencies.)Once I have your confirmation, I’ll pull the data, detect the events, and run the back-test.

Parsons at Inflection Point: DTRA Wins vs. FAA Losses
Parsons’ 25% plunge reflects a critical juncture: the DTRA contract secures long-term relevance in threat reduction, but the FAA setback exposes near-term revenue risks. Technicals and options activity confirm the bearish shift, with the 52-week low now in sight. While Lockheed Martin’s 0.48% gain highlights sector resilience, Parsons’ fate hinges on its ability to pivot from bidding losses to execution wins. Watch for a $60 breakdown or a catalyst-driven rebound in the coming weeks.