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Verizon (VZ) Unit Secures Deal to Modernize U.S. DOL's Network

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Verizon Communications Inc.’s VZ unit, Verizon Public Sector, has secured five Enterprise Infrastructure Solutions (EIS) task orders from the U.S. Department of Labor (“DOL”) to modernize the latter’s network infrastructure.

Valued at $887 million, these deals span data, voice, unified communications, video services, and enterprise applications for the DOL’s 20,000 end users. It strengthens Verizon Public Sector’s position as the end-to-end digital solutions provider for its government customers.

The partnership between Verizon Public Sector and the DOL will result in a highly secure, converged data and voice network across almost 1,000 locations. Verizon will work with the DOL to drive the adoption of innovative technologies with a managed services solution.

Verizon’s disciplined network strategy for long-term sustainable growth, along with operational execution, is noteworthy. The company’s shares have lost 9% in the past year compared with the industry’s decline of 1.6%.

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The first task order will modernize the DOL’s IT backbone with new network architecture to build a managed network with data, voice, and toll-free services. The second one will continue the existing work to transform the DOL’s audio and web conferencing services through customized use options.

The third one allows for the immediate delivery of Content Delivery Network Services. Verizon Public Sector will enhance these services to provide improved capabilities, creating an enterprise-level cloud platform for Infrastructure as a Service, Platform as a Service, and Software as a Service.

The fourth one will address the DOL’s Managed Trusted Internet Protocol Service (MTIPS) and calls for the installation of MTIPS ports for the department’s seven data centers across the country.

The fifth one will support the deployment of Unified Communications Services (UCS) for 20,000 DOL users. The UCS will integrate multiple methods of communication, including moving to IP-based voice and video services that will allow the DOL workforce to exchange information via wireless.

Through a previously issued task order, Verizon Public Sector has transitioned the DOL’s Co-located Hosting Service requirements from its previous GSA’s Networx contract to the EIS contract. This will help reduce the department’s IT infrastructure costs and provide access to a scalable data center environment. The latest deal wins will aid Verizon’s top line in the long run.

The stock currently carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks in the broader industry are InterDigital, Inc. IDCC, Qualcomm, Inc. QCOM, and Nokia Corp. NOK. While InterDigital sports a Zacks Rank #1 (Strong Buy), Qualcomm and Nokia carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

InterDigital delivered a trailing four-quarter earnings surprise of 536%, on average.

Qualcomm pulled off a trailing four-quarter earnings surprise of 13.5%, on average.

Nokia delivered a trailing four-quarter earnings surprise of 202.7%, on average.


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