Science Applications International Corp. (SAIC - Free Report) recently secured an eight-year prime contract worth $85 million. Per the deal, the company will provide advanced IT support and maintenance services for the city of Anaheim, CA’s infrastructure, applications and workplace solutions.
Reportedly, Science Applications’ advanced delivery model will also ensure maximum cost-efficiencies.
The fixed-price contract work will mainly be performed on-site in Anaheim, with services offered to some remote areas within the continental United States.
Contract Wins Boost Growth
Science Applications has been doing very well with a record level of awards, which reflects its disciplined business development actions, consistent operational excellence and high customer satisfaction.
Earlier this month, the company was awarded a systems integration IDIQ contract with a ceiling value of $60 million. This was an important step toward stabilizing and securing critical IT systems for the U.S. Patent and Trademark Office.
In November last year, the company was awarded a $77 million fixed-price contract by County of Orange, CA, which required Science Applications to provide its managed IT services to agencies within the county.
The company has a large pipeline of new projects and continues to win more deals at regular intervals. Notably, as of Aug 2, 2019, its total backlog was $13.9 billion. These back-to-back contract wins are the key catalysts driving success for Science Applications.
The company continues to execute its strategy of winning high-value contracts, delivering excellence to customers and deploying capital for growth. Its robust business model is expected to help it grow further.
Prospects Bright Despite Competition
Competition from CACI International (CACI - Free Report) in the IT services space remains steady. CACI continues to win high-value contracts, and recently secured a five-year task order worth $443 million from the U.S. Army.
In the IT services industry, Science Applications also competes with IBM (IBM - Free Report) and Accenture (ACN - Free Report) , which are considered among the top IT service providers in the world.
Nonetheless, Science Application’s buyout of IT service provider Engility is expected to boost its growth in key markets and enhance competitive position.
Per a study conducted by Market Watch, the global IT Services market is expected to witness a CAGR of 2.6% in terms of revenues over the next five years. The global market size is anticipated to reach $1.15 trillion by 2024, up from $1.01 trillion expected in 2019. This forecast bodes well for Science Applications, which is a key supplier in the global IT services market.
The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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