CA Technologies
(
CA
) was recently selected by Tata Steel for streamlining the process
of innovation of new steel solutions.
CA provides IT solutions to the steel companies across the
globe. Tata Steel is expected to deploy CA's Clarity Project and
Portfolio Management (PPM) solutions in order to manage the new
product and service lifecycle from the product design stage through
production and delivery.
The company expects this technology innovation to define a
structured approach, which will ultimately revolutionize the
process, thereby increasing efficiency and reducing the time to
market.
Tata Steel has been transforming its European arm into a more
customer-focused organization by realigning its internal resources
to industry sectors such as automotive, lifting and excavating,
energy and power, packaging, construction and rail. CA's offering
will play a new role here, transforming and restructuring the whole
process.
CA has been reshuffling its management team in order to promote
the innovation of new products and solutions. This apart, the
company has adopted certain strategies to drive growth, of which
the focus on the SaaS/service provider market is notable.
The company has started to reap the benefits of acquisitions,
restructuring and strategic investments made over the past three
years. Further, while competitive wins are positive, margin
expansion is on the cards for fiscal 2013 and beyond.
CA Inc. posted decent fourth quarter results exceeding the
earnings estimates. Revenue also improved on a year-over-year basis
as the company witnessed improvement in demand for its services.
However, the product demand trend was moderate in the reported
quarter. This apart, the company has implemented some fiscal
discipline to improve its operating performance.
On the other hand, other players are also coming up with new
products and solutions targeting the software and cloud computing
space. The company is pitted against technology stalwarts like
IBM Corp.
(
IBM
) and
Hewlett-Packard Company
(
HPQ
). Moreover, we believe that tech spending will take some time to
pick up and European exposure may continue to pose some challenges
over the next few quarters.
The company has a short-term Zacks #3 Rank. (Hold rating).
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