Dozens of local government contractors are trying to find buyers as they struggle to cope with cuts in defense and other federal spending, investment bankers and financial analysts said last week. And those same companies may not be too pleased with what the financial experts have to say about what they can get on the mergers and acquisitions market.

At a seminar on government contracting last week, Edward Blum, who heads his own investment banking company in Reston, noted that BDM International Inc. in McLean was sold for $425 million in 1988 to Ford Aerospace. He said the word on the street is that today BDM is valued at about $140 million to $160 million.

Jerry Grossman, senior adviser to Willamette Management Associates Inc., which specializes in business valuations, said BDM is not an anomaly. A few years ago, he said, defense companies sold for more than their annual revenue, while now they are being priced at 50 percent to 60 percent of revenue, even with the same level of activity and profitability or a bigger backlog of business.

"It's brutal if you're on the selling side," said Blum. However, he added, "It looks good if you're on the buying side." Blum said buyers can now pick up companies they couldn't have afforded just two years ago. And he said there are people out there who are bargain hunting.