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Unisys Gallops on DHS Contract

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Earlier this week, Unisys Corporation (UIS - Free Report) won a contract from the Department of Homeland Security (DHS) to compete for task orders with 29 other companies under the Tactical Communications Equipment and Services contract vehicle. Pertaining to a total term period of five years (including three option years), this indefinite delivery/indefinite quantity (IDIQ) contract has a potential capped value of $3 billion.

The federal government hopes to improve its legacy mission-critical public safety communications system with state-of-the-art interoperable, digital IP-based solutions which would allow for the seamless integration of voice, data and video. Not only the DHS but the White House along with the Interior, Justice and State departments of the U.S. can gain access to services under the contract.

There are a total of five categories under this contract vehicle within which Unisys shall compete to gain task orders in two of them; one of them being infrastructure services and operations and the other, maintenance services. Previously, the company used to have a good experience in providing tactical communication support solutions to the DHS’ components like the Transportation Security Administration and the National Programs. However, it would be interesting to see how Unisys serves the federal government and other agencies under this prestigious new vehicle of which it is a part now.

Unisys has been on quite a spree of winning government contracts of late. On June 21, 2012, the company was awarded a contract from The National Institutes of Health (NIH) to compete for task orders under the Chief Information Officers-Solutions and Partners 3 (CIO-SP3) contract vehicle. This contract received by the company from the DHS marks the second prestigious federal panegyric within a span of just seven days.

The company also keeps an eye out for making technological advancements for its customers on a continual basis. On June 26, 2012, Unisys launched a new cloud-based IT Service Management (ITSM) solution platform. With this solution its clients can now easily start using an ITIL-based system at a cheaper cost.

However, it is important to be aware of similar competitor moves in the industry. On June 19, 2012, Acxiom Corporation (ACXM - Free Report) was selected by Mindshare for providing consumer insight services in the U.S., Europe and Australia for its CORE platform.

Unisys currently retains a Zacks #3 Rank, which translates into a short-term ‘Hold’ rating. However, we presently maintain our ‘Neutral’ recommendation on the stock.

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