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BOX Expands Client Base With 5-Year $6.2-Million DCMA Deal

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Increasing adoption of Box, Inc.’s (BOX - Free Report) cloud management platform by clients reiterates the strength and innovative nature of the product portfolio.

Recently, Box announced that the Defense Contract Management Agency (“DCMA”) has signed a five-year contract worth $6.2 million in September 2020. Per the deal, DCMA can use Box’s enterprise cloud content management platform to support its work and reduce operating costs over the coming years.

Through this cloud platform, DCMA aims to meet the future mission needs to support the Department of Defense (DoD) stakeholders.

DCMA provides contract administration services to the DoD, other federal organizations and international partners. The Agency manages approximately 300,000 contracts at 15,000 contractor locations worldwide. These contracts are valued at more than $7 trillion.

The deal will expand Box’s customer base. With the growing deployment of the platform, Box will generate more revenues and the top line will gain momentum.

Box, Inc. Price and Consensus

Box, Inc. Price and Consensus

Box, Inc. price-consensus-chart | Box, Inc. Quote

Strengthening Clientele

The company’s strong product portfolio has been able to help it generate a solid client base. Box enables in-house enterprise developers, and independent software developers create industry and market-focused applications with ease.

DCMA is deploying Box’s cloud platform to enhance business performance by using new and modern ways of working.

In addition to DCMA, U.S. Air Force, USDA Forest Service and Farm Production and Conservation, National Institutes of Health, Department of Justice, along with the District of Columbia Government have adopted the company’s platform.

Box’s strategic partnership with Google Cloud and Microsoft’s Azure is helping it to integrate its platform. This added enhanced features such as artificial intelligence, machine learning, and image recognition capabilities to Box’s cloud products as well as services.

Hence, the company enjoys a strong client and user base.

Cloud Market Opportunities

Cloud still remains an expanding market with huge prospects. In a recent report, Gartner projected the public cloud service market to grow 6.3% in 2020 to $257.9 billion.

Also, per a Markets and Markets report, the market for cloud enterprise content management is expected to witness a CAGR of 28.6% between 2020 and 2025, and reach $34.42 billion by 2022.

We believe that Box is well positioned to take advantage of the projected growth in the cloud segment and moves like the latest one will positively impact the top line.

Zacks Rank & Key Picks

Currently, Box carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader technology sector include The Trade Desk Inc. (TTD - Free Report) , Dropbox, Inc. (DBX - Free Report) and Marchex, Inc. (MCHX - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Long-term earnings growth for The Trade Desk, Dropbox, and Marchex is currently projected at 25%, 40.9% and 15%, respectively.

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