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CACI International (CACI) Secures Army Contract Worth $239M
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CACI International (CACI - Free Report) shares have gained 43.3% in the year-to-date period compared with the Zacks Computer Services industry’s growth of 8.9%. This reflects investors’ confidence as CACI continues to receive a steady flow of contracts.
Recently, CACI secured a task order from the U.S. Army to support operations and provide intelligence analysis in the army’s operations throughout Europe and Africa. The task order is valued at $239 million and spans for six years.
The intelligence support will cover cross-functional analysis and multi-domain operations. It will also support the Army’s security infrastructure and maintain information systems. CACI will also provide its dark web technologies, including DarkBlue Intelligence Suite, for in-depth surveillance and analysis work.
In this six-year-long contract, CACI International will continuously support the U.S. Army’s European Command and U.S. Africa Command during the crisis and peacetime. This contract is one among the many contracts that CACI has secured from the U.S. Army in 2024.
Earlier this year, CACI secured a $198 million contract to improve the army’s cyber defense. This was followed by other U.S. Army contracts covering support for defense intelligence agencies, network modernization and operational support for unmanned systems.
Steady Flow of Government Contracts Aids CACI
CACI has a large pipeline of new projects and continues to win more deals at regular intervals. Moreover, having the government as a big client lends stability to the business and moderates fluctuations in revenues.
CACI International also benefits from the higher spending as proposed in the latest federal government budget. The increased budget is expected to accelerate the pace of contract awards, which, in turn, will be beneficial for CACI’s top-line growth.
A leader in IT outsourcing for the U.S. federal government, CACI International has ample exposure to the rapidly growing DoD and Department of Homeland Security budgets.
Persistent Economic and Competitive Pressure
CACI International operates in a highly competitive defense, space, intelligence and mission-critical services market that consists of contenders, including Science Applications International (SAIC - Free Report) , Leidos Holdings (LDOS - Free Report) and KBR Inc. (KBR - Free Report) .
CACI’s competitors, Science Applications, KBR and Leidos, are established players in the industry with their respective strengths. These companies also compete for the limited number of government contracts from the Department of Defense, the Department of Homeland Security and other U.S. government agencies, causing a highly competitive environment in this niche industry. This high competition causes pricing pressure leading to low-margin government deals affecting CACI’s profitability.
CACI International is also facing challenges from recessionary concerns amid the ongoing macroeconomic and geopolitical tensions that might lead to softened spending by government agencies. The company’s near-term prospects are weighed down by these negative factors.
Conclusion
CACI International is receiving a steady flow of deals from government agencies. However, most of these contracts have low margins that affect profitability. Intensified competition and softened customer spending amid uncertain microeconomic conditions are other concerns.
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CACI International (CACI) Secures Army Contract Worth $239M
CACI International (CACI - Free Report) shares have gained 43.3% in the year-to-date period compared with the Zacks Computer Services industry’s growth of 8.9%. This reflects investors’ confidence as CACI continues to receive a steady flow of contracts.
Recently, CACI secured a task order from the U.S. Army to support operations and provide intelligence analysis in the army’s operations throughout Europe and Africa. The task order is valued at $239 million and spans for six years.
The intelligence support will cover cross-functional analysis and multi-domain operations. It will also support the Army’s security infrastructure and maintain information systems. CACI will also provide its dark web technologies, including DarkBlue Intelligence Suite, for in-depth surveillance and analysis work.
CACI International, Inc. Price and Consensus
CACI International, Inc. price-consensus-chart | CACI International, Inc. Quote
In this six-year-long contract, CACI International will continuously support the U.S. Army’s European Command and U.S. Africa Command during the crisis and peacetime. This contract is one among the many contracts that CACI has secured from the U.S. Army in 2024.
Earlier this year, CACI secured a $198 million contract to improve the army’s cyber defense. This was followed by other U.S. Army contracts covering support for defense intelligence agencies, network modernization and operational support for unmanned systems.
Steady Flow of Government Contracts Aids CACI
CACI has a large pipeline of new projects and continues to win more deals at regular intervals. Moreover, having the government as a big client lends stability to the business and moderates fluctuations in revenues.
CACI International also benefits from the higher spending as proposed in the latest federal government budget. The increased budget is expected to accelerate the pace of contract awards, which, in turn, will be beneficial for CACI’s top-line growth.
A leader in IT outsourcing for the U.S. federal government, CACI International has ample exposure to the rapidly growing DoD and Department of Homeland Security budgets.
Persistent Economic and Competitive Pressure
CACI International operates in a highly competitive defense, space, intelligence and mission-critical services market that consists of contenders, including Science Applications International (SAIC - Free Report) , Leidos Holdings (LDOS - Free Report) and KBR Inc. (KBR - Free Report) .
CACI’s competitors, Science Applications, KBR and Leidos, are established players in the industry with their respective strengths. These companies also compete for the limited number of government contracts from the Department of Defense, the Department of Homeland Security and other U.S. government agencies, causing a highly competitive environment in this niche industry. This high competition causes pricing pressure leading to low-margin government deals affecting CACI’s profitability.
CACI International is also facing challenges from recessionary concerns amid the ongoing macroeconomic and geopolitical tensions that might lead to softened spending by government agencies. The company’s near-term prospects are weighed down by these negative factors.
Conclusion
CACI International is receiving a steady flow of deals from government agencies. However, most of these contracts have low margins that affect profitability. Intensified competition and softened customer spending amid uncertain microeconomic conditions are other concerns.
CACI International carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.