CACI International reported lackluster second quarter fiscal 2014
results with year-over-year decline in earnings and revenues.
However, the company remains focused on its strategy to grow in
large markets, introduce new business initiatives, and leverage on
mergers and acquisitions to further increase its market share. The
acquisition of Six3 systems is likely to be beneficial for the
company in the long term. The company also expects to diligently
focus on its operating plans to reward its shareholders with
attractive risk-adjusted returns. We are changing our long-term
recommendation for the stock from Neutral to Outperform as we
expect it to perform above the broader market. However, reduced EPS
fiscal guidance remains possible headwind for the company.
Based in Arlington, Virginia, CACI International delivers IT
applications and infrastructure to improve communications and
secure the integrity of information systems and networks, enhance
data collection and analysis, and increase efficiency and mission
effectiveness. The company's solutions enhance defense and
intelligence capabilities, assure homeland security, improve
decision-making, and help customers operate smartly and
The company primarily operates in two segments:
Domestic operations- The operations are channeled through
subsidiaries and a joint venture in which CACI has a controlling
stake. The services offered are categorized as Enterprise IT and
Network Services Data, Information and Knowledge Management
Services Business System Solutions, Logistics and Material
Readiness Services Command, Control, Communications, Computers,
Intelligence, Surveillance and Reconnaissance (C4ISR) Integration
Services Cyber Security, Integrated Security and Intelligence
Solutions and Program Management and System Engineering and
Technical Assistance (SETA) Services.
International Operations- The operations are carried out through
its subsidiary in Europe. International segment's solutions support
commercial and government clients in telecommunications, education,
financial services, healthcare services and transportation sectors.
It furnishes solutions to specific technical or business
requirement by planning, designing, implementing and managing
The company earns its revenues through four customer groups:
Department of Defense (DoD), Federal Civilian Agencies, Commercial
and Other, and State and Local Governments. DoD customers include
the U.S. Army (CACI's largest customer) and the U.S. Navy. The
company offers solution that supports combat operations and
concentrates on affirming readiness, tactical military intelligence
and communications. It safeguards the U.S. Navy fleet by automatic
identification technologies and mine countermeasure program.
Federal civilian agencies cater litigation support services to
Department of Justice (DoJ).
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