Computer Sciences Corporation
) recently announced that it has secured a place among the 54
companies, which have been selected for an information technology
(IT) services solutions contract by the National Institutes of
Health Information Technology Acquisition and Assessment Center
The contract spans for 10 years and is estimated at $20 billion.
The contract was signed in the first quarter of CSC's fiscal year
The company has a long standing relationship of over 15 years
with National Institutes of Health, and has provided world-class
solutions to the federal agencies. As per the terms of this
agreement, the company will offer its service solutions to
different federal, civilian and defense verticals, in order to
enhance their IT requirements.
Last month, Computer Sciences also won two similar contracts.
The company's Enterprise Scheduling solution (a healthcare suite)
was chosen by a Singapore-based multi-disciplinary hospital, Tan
Tock Seng Hospital.
Apart from this, Computer Sciences also won a multi-year
contract extension from Safety Insurance Group for an undisclosed
Moreover, a change in the healthcare system is coming from the
increasing use of IT on the ground level, which includes the
meaningful use of electronic health records (EHR), The company is
also playing a major role in enhancing the cloud based EHR
The company is an old vendor of the U.S. government and has some
existing contracts with some government agencies. Moreover, the
time taken to secure a new government contract is substantial, as
the government's decision-making process is tedious.
Deal wins act as catalysts for any company and Computer Sciences
has no dearth of them. But the growing uncertainty regarding the
European economy, intense competition in the IT and cloud computing
space from both small and big players such as
), and strained federal budgets have prompted our bearish outlook
on the stock.
Currently, CSC holds a Zacks #4 Rank (implying a short-term Sell
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