CSC Wins New SAP Deal - Analyst Blog


Information Technology major Computer Sciences Corporation ( CSC ) recently announced that it has been chosen by a leading Kuwait-based engineering and construction company Combined Group Contracting (CGC), as the company's SAP implementation partner.

As per the terms of the contract, the implementation will be done by CSC India, while the execution will be carried out by a team of SAP consultants from CGC's offices in Kuwait and CSC India's offshore delivery centre.

The company is consistently winning private and government orders, which will likely extend its customer base.

Computer Sciences has won a number of deals over the past six months. The company is not only generating revenue through new deal wins, but recently announced that it will be licensing its legal management software to SafeAuto Insurance Company. Financial details of the deal were not divulged.

Leveraging the solution, the auto-insurance carrier will be able to measure its legal expense before-hand and reduce the same accordingly. Moreover, it will allow SafeAuto to improve communication with law firms and individual lawyers. This will ultimately help the company to expand into additional geographies while dealing with legal matters easily.

Computer Sciences is one of the leading players in the information technology (IT) services industry. CSC reported mediocre fourth quarter 2012 results, with quarterly loss missing the Zacks Consensus Estimate. Operating performance could be described as moderate at best, although new business awards improved meaningfully.

Deal wins are catalysts for any company and Computer Sciences has no dearth of them. But the continued uncertainty regarding the U.K. National Health Service contract, intense competition in the IT and cloud computing space from both small and big players such as Accenture plc ( ACN ) and Hewlett-Packard Company ( HPQ ), its European exposure and strained federal budgets have prompted our bearish outlook on the stock.

Currently, CSC holds a Zacks #5 Rank (implying a short-term Strong Sell rating).

ACCENTURE PLC (ACN): Free Stock Analysis Report
COMP SCIENCE (CSC): Free Stock Analysis Report

HEWLETT PACKARD (HPQ): Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: ACN , CSC , HPQ , IT

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