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CACI Strengthens DoD Ties with $37 Million Contract

Zacks Equity Research

CACI International Inc. CACI, a defense and intelligence information technology company based in Arlington, VA, recently announced that it was awarded a prime contract worth $37 million. The company will continue to provide its support to the Defense Agencies Initiative (DAI) Global Model federal financial management and accounting solution, for the next three years.

The Department of Defense’s (DoD) DAI is a system which provides budget, finance, and accounting processes of most DoD agencies. CACI’s Business System offers in depth expertise and solutions in support of the DAI. Under this contract, CACI will provide solutions to more than 25,000 users across multiple defense agencies.

The Deal

Per this contract, CACI will assist the DoD in financial management and accounting systems and processes across various agencies. This will help customers get real-time visibility into transactions, improve services and processes, and save time and cost.

The company continues to focus on developing industry-leading experience and expertise to help customers modernize and improve their financial systems. The company’s Business System will help DoD decision-makers to serve and equip the country’s military men and women.

Within the purview of the current contract, financial services provided by the company will enable the DoD to ensure a high level of accuracy and overcome challenges that come its way. In recent years, CACI has clinched a number of government contracts that have widened its footprint in the industry. These contracts have cemented its position as one of the most reliable security services firms in the world.



CACI’s Achievements

CACI International has a large pipeline of new projects and continues to win deals at regular intervals. These back-to-back contract wins are the key catalysts driving the company. Furthermore, having the government as a big client lends stability to the business and moderates fluctuations in revenue. Although the government generally has a lengthy approval process, the project earns money for a number of years after it is approved.

Moreover, government contracts improve the visibility of future revenue streams. The company has been doing very well with a record level of awards, which reflect its disciplined business development actions, consistent operational excellence and high customer satisfaction.

Going forward, the company continues to execute its strategy of winning high-value contracts, delivering excellence to its customers and deploying its capital for growth. The company’s robust business model is expected to help it grow and achieve newer heights.

However, CACI International generates revenue from contracts and task orders awarded through a competitive bidding process. These contracts contain provisions permitting a government client to terminate the contract for convenience. A decision to terminate contracts on an ongoing basis for convenience is likely to result in significant revenue shortfalls for the company.

CACI carries a Zacks Rank #3 (Hold). Some better ranked stocks in the same space include Ebix Inc. EBIX, ManTech International Corp. MANT and The KEYW Holding Corp. KEYW. All three stocks carry a Zacks Rank #2 (Buy).

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