Hewlett-Packard Co.
's (
HPQ
) Enterprise Services unit received two task orders from the U.S.
Army Human Resources Command (AHRC) for an undisclosed sum. The
task orders require H-P to continue providing information
technology (IT) services to improve the agency's recruitment
procedure and overall departmental operations in a cost-effective
manner. The U.S. agency has been assigned the task of managing
careers of potential army soldiers.
Under the first task order, H-P will continue to manage IT
infrastructure for AHRC with the help of its data center services
for another three years. H-P has been providing this support
since past 20 years. The data center service includes support for
hardware (PCs, laptops and printers), networking, enterprise
architecture and help desk. The new task order would also require
H-P to extend its services for the U.S. Army Cadet Command and
Army Recruiting Command, in addition to AHRC.
Under the second task order, H-P will help AHRC in
hiring/recruiting personnel through its Applications Services.
With this service, AHRC can manage applications from prospective
candidates and select suitable candidates for the job. The
service also allows AHRC to simplify the process of online
applications.
Last week, H-P's Enterprise Services unit was chosen by the U.S.
Department of Homeland Security Department to provide call-center
support for its U.S. Citizenship and Immigration Services
('USCIS') arm. The 5-year task order was valued at $220.5
million.
Though deal wins under the Enterprise Services unit is pretty
frequent, the segment's financial performances are not
encouraging. In the recently concluded first quarter 2013, the
segment registered a year over year revenue decline of 7.0%. But
during the call, H-P mentioned that it will continue to focus on
strategic enterprise services business, which includes cloud,
application modernization, security and information management,
and analytics. We find H-P's commentary encouraging and believe
that the continuous deal wins will lead to better growth
prospects for the segment.
Though further indication of PC market slump in 2013, declining
revenues and competition from
Dell Inc.
(
DELL
) are concerns, back-to-back product launches and growing
exposure into enterprise storage space are encouraging.
Currently, H-P has a Zacks Rank #2 (Buy). Other technology stocks
that warrant consideration are
Symantec Corp.
(
SYMC
) and
Synopsys Inc.
(
SNPS
).
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