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Recently, CACI International Inc. (CACI - Analyst Report) announced securing a prime position in the Global Tactical Advanced Communications Systems (GTACS) contract worth $10 billion. Awarded by the U.S. Army, this contract pertains to providing various services including building up, promotion and maintenance of turnkey telecommunications support solutions to the Army’s Program Executive Office Command, Control and Communications-Tactical (PEO C3T).

The company has been chosen by U.S. Army as one of the key service providers under the five-year agreement, which pertains to indefinite delivery and indefinite quantity stipulations. With the agreement, the company will be able to strengthen its foothold in the command, control, communications, computers, intelligence, surveillance, and reconnaissance (C4ISR) market.

Per this contract, the company will be engaged in creating and integrating a wide range of mobile and fixed-site communications processes, networks and ancillary equipment services. Services in the contract also entail training and sustainment supports to fulfill the need of Department of Defense (DoD) and civilian agency missions.

Additionally, the company will also focus on quick-reaction prototyping and integrating commercial as well as government procedures through diversified delivery portals. Under the contract, CACI will be distributing telecommunications solutions in the United States as well as abroad.

Management stated that CACI International’s expert services are likely to minimize any kind of external risk for the government through providing mission-critical support solutions to its clients. With the contract, the company will be able to extend its coverage in the government’s communications market.

Contract wins have forever been the niche strength for CACI International. Very recently, the company was awarded a follow-on contract worth $53 million. Awarded by the Naval Sea Systems Command (NAVSEA), this contract pertains to providing various services including acquisition and lifecycle, data management, financial management, and technical support to the Expeditionary Warfare and Maritime Surveillance Program Offices (PMS408 and PMS485). The steady flow of contracts helps the company retain its formidable position in the industry.

However, the company needs to be wary of its formidable competitors who include big names such as, CGI Group, Inc. (GIB - Snapshot Report) and ManTech International Corporation (MANT - Snapshot Report). CGI Group’s operating unit CGI Federal Inc. (CGI), recently entered into a partnership agreement with Centers for Medicare & Medicaid Services (CMS). Per the contract, CGI Group will be involved in recreating and introducing the official U.S. Government website, namely, Medicare.gov, under the Medicare program. Hence, the company should not become complacent with its contract win spree.

The current Zacks Consensus Estimates for CACI International Inc. are $1.64 and $6.60 per share for the second quarter of fiscal 2013 and fiscal 2013 (ending June 30, 2013), respectively. The estimates represent a year-over-year growth of 8.70% for the second quarter and 11.07% for fiscal 2013. At present, we have a ‘Neutral’ recommendation on CACI International Inc. The stock currently carries a Zacks #3 Rank, which translates into a short-term ‘Hold’ rating.

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