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SAIC Secures Space and Intelligence Contract Worth $664M in Q2

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Science Applications (SAIC - Free Report) announced on Thursday that it has secured $664 million worth of contracts from the space and intelligence communities in the second quarter of fiscal 2022.

The company disclosed that most of the contracts involve highly-specialized services in digital engineering, artificial intelligence, cloud, technology integration, cybersecurity, information technology modernization and mission operations areas. The clients requiring these services belong to classified space and intelligence communities.

The quarterly total includes a contract worth $335 million, under which the company is required to provide digital and systems engineering solutions to intelligence and defense agencies.

It also includes a single-award, $90-million contract from the U.S. Air Force Life Cycle and Management Center, Force Protection Division. Per the deal, the company will help the U.S. Department of Defense modernize and strengthen defense against sophisticated threats like small unmanned aircraft system (sUAS) threats.

SAIC Continues to Win Defense Contracts

SAIC is benefiting from the continued flow of high-value contracts. A record level of awards reflects its disciplined business-development actions, consistent operational excellence and high customer satisfaction. Notably, as of Apr 30, 2021, the company’s total contract backlog was $24 billion.

Furthermore, having the government as a big client lends stability to the business and moderates fluctuation in revenues.

This July, SAIC secured a five-year, $85 million, single-award, cost-plus-fixed-fee contract from the U.S. Navy. Per the deal, the company will continue to provide software engineering, DevSecOps, cloud migration, and cyber support to the U.S. Navy’s Joint Expeditionary Command and Control (JEXC2) family of systems.

In June, SAIC received a five-year, $126-million, single-award task order from the Department of Defense Information Analysis Center to provide research and development (R&D) support to the U.S. Army Combat Capabilities Development Command (DEVCOM) Ground Vehicle Systems Center (GVSC).

In May, the company received a major single-award defense contract with an estimated ceiling value of approximately $200 million, to provide laboratory operations and support to the Defense Intelligence Agency.

Moreover, this April, the company received a contract worth $3.6 billion from the U.S. Army to continue supporting the U.S. Army Combat Capabilities DEVCOM Aviation & Missile Center, Software, Simulation, Systems Engineering and Integration (S3I) Directorate.

Zacks Rank & Key Picks

Currently, SAIC carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the broader technology sector include Microsoft (MSFT - Free Report) , Cadence Design Systems (CDNS - Free Report) and Texas Instruments (TXN - Free Report) , all carrying a Zacks Rank of 2 (Buy), at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The long-term earnings growth rate for Microsoft, Cadence Design and Texas Instruments is currently pegged at 11.1%, 11.7% and 9.3%, respectively.

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