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CSRA Wins Potential $24.5 Million STS Contract from EPA

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CSRA Inc. recently announced that its subsidiary, SRA International Inc, has been awarded a Scientific and Technical Support (STS) contract by the U.S. Environmental Protection Agency (EPA). The potential $24.5-million worth deal has a performance period of five years.

Per the deal, CSRA will be assisting the EPA Office of Water (OW) Engineering and Analysis Division. This division deals with the issuance of regulations related to guidelines and publishing of analytical methods according to the Clean Water Act.

CSRA has been entrusted with the responsibility of “study design and implementation”, as well as development and validation of the laboratory methods required for environmental sample analysis. The company will also be addressing quality assurance and data management for the entire system.

Notably, CSRA had won all the prior versions of the above discussed contract and this one followed a similar recently-expired one. We believe the frequent contract wins for this pure-play government IT service provider are positives for top-line growth. The CSRA stock has gained 1.4% year to date, underperforming 28.1% growth recorded by the industry it belongs to.

Frequent Contract Wins

CSRA’s solid domain knowledge and expertise in next-generation IT services is helping it win new contracts on a regular basis. Most recently, the company entered into a blanket purchase agreement with the U.S. Navy.

In early September, the company won the massive $2.4 billion Greenway contract via its 79% shareholding joint venture — Eagle Alliance. Also, in August, it secured a $115 million contract from the EPA Office of Environmental Information (OEI).

CSRA Inc. Revenue (TTM)

CSRA Inc. Revenue (TTM) | CSRA Inc. Quote

Improving Federal Spending and Partnerships

CSRA believes the passing of the Modernizing Government Technology Act, which establishes a government-wide technology modernization fund worth $500 million, indicates a favorable spending environment, which will positively impact the company’s growth.

Moreover, partnership with the likes of ServiceNow (NOW - Free Report) , Microsoft (MSFT - Free Report) and Red Hat among others is a positive. The acquisition of NES in July 2017 is also expected to bolster the company’s revenues in the near term.

Zacks Rank

CSRA currently has a Zacks Rank #3 (Hold).

You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

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