Cscs Navy
Cscs Navy
CSC Wins Government Deals
CSC Inc. (CSC) continues with its trend of winning new deals. This ability is expected to help the company achieve new heights in its business and scale up business volume. After winning and extending several agreements during the earlier half of the month, the company has recently grabbed a $33.0 million contract from the U.S. Navy.
As per the terms of the agreement, CSC will be providing information technology (IT) support to the Naval Surface Warfare Center (NSWC) and the Naval Support Activity. This apart, the company will also provide network and administrative support to the client. This contract has a base period of two years, along with three one-year renewal options, bringing the total period to five years.
Moreover, the company grabbed a second contract for an estimated value of $25.0 million from the Space and Naval Warfare Systems Center Atlantic. As per the terms of the contract, CSC will provide integrated network services to naval fleet users situated at overseas locations. The contract has a one-year base period and also provides for four one-year extensions.
So it is evident that the company is seeing significant success in the government vertical. This is encouraging, since this segment typically enables steady flow of revenue and is, therefore, relatively stable.
CSC’s innovative solutions, new product offerings, aggressive growth strategy and customer friendly approach are helping it win new business contracts. Furthermore, the company’s established business relationship with government departments is an added bonus, providing a competitive advantage over others.
Things look encouraging for CSC, although the company is experiencing stiff competition from technology giants like Accenture (ACN), Hewlett-Packard (HPQ) and CA Inc. (CA). On the bullish side, CSC reported decent fourth quarter results and provided a positive view for fiscal 2010.
The company is growing through acquisitions that enhance its services portfolio and expand its operations in new markets. CSC is blessed with a steady flow of new business, especially in the government vertical and is financially sound.
We are cautiously optimistic on the stock and maintain a Neutral rating.
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