Investing.com - The Elon Musk-led Department of Government Efficiency’s latest savings claim largely impacted the Department of Homeland Security, according to analysts at BofA.
The brokerage said in a note to clients that the total savings amount from government contract cancellations and renegotiations, which was calculated as of March 19, came in at $19.1 billion, up from a prior figure of $18 billion.
However, BofA reiterated an earlier argument that the figure "seems overstated." The bank has previously said that methodology used by the department -- commonly known as "DOGE" -- for counting up savings revolves around tabulating the difference between contract ceiling value and most recent obligation. This method, they argued, could be misleading because "in many cases contract obligations do not end up reaching the ceiling value."
The BofA analysts said they had also identified "some cases" of double counting in the elimination of contracts and subcontracts.
DOGE, which has been charged by President Donald Trump with downsizing government spending, most recently said it had saved around $20 billion from 6,637 contract terminations.
The U.S. Agency for International Development and the Treasury Department were the most heavily impacted agencies to date, the BofA calculations found, although the analysts noted that these agencies "were among the first targeted by DOGE." The Department of Homeland Security saw the biggest weekly increase in savings, rising to $809 million from $226 million from a prior figure on March 11.
Savings from the Department of Defense of $10.1 million were also up marginally versus DOGE’s previous numbers. But the BofA analysts flagged that the DoD released a memo on March 20 from Secretary Pete Hegseth cancelling $580 million of grants and contracts, which would result in $170 million in savings.
In terms of individual-listed companies affected by the cuts and covered by BofA, IT service provider General Dynamics (NYSE:GD) Information Technology received two additional cancellations on Department of Veterans Affairs and Department of Health and Human Services contracts. In total, the DOGE actions have resulted in an impact on the group of $65 million in lost annual run rate obligations so far.
Cancelled contracts have also dented Booz Allen (NYSE:BAH) Hamilton by around $17 million per year, although the management consultancy has received $39 million in new obligations since Trump’s inauguration on January 20, the BofA analysts said.