By Zacks Equity Research

Unisys (UIS) recently announced it has been selected by the U.S. General Services Administration's (GSA) Federal Systems Integration and Management Center (FEDSIM) to operate and manage the database and middleware systems for the agency's Federal Acquisition Service (FAS).
 

This award forms a part of GSA's Alliant government-wide acquisition contract for the Database and Middleware Support (DBAMS) project. This organization primarily obtains goods and services for agencies across the federal government. 
 

The contract spans five years and is estimated to be worth $28 million. It has a 2.5-month base period and four one-year options, as well as one 9.5-month option period subsequently.
 

The DBASM contract will involve the consolidation and upgrade of FAS' mission-critical databases and middleware. These systems enable the organization's core mission applications and are integral to FAS' electronic commerce, acquisition and document management processes.
 

Additionally, Unisys might be required to provide assessment services to ensure smooth transition of the FAS database and middleware systems to a cloud-based database-as-a-servic​e model. As a result of this migration, GSA will not be required to deploy and maintain its own database hardware and software, thereby leading to reduced costs.
 
Management at Unisys is encouraged by this expanded relationship with GSA.
 

Earlier, Unisys was awarded the Enterprise Storage Acquisition task order from the Internal Revenue Service (IRS), whereby Unisys will provide private cloud-based storage for the agency's information records.
 

The task order, with a one year base period and nine one-year options, is estimated at $139 million over 10 years, if options are exercised. The worth was estimated by including pricing for each year based on the IRS's estimate of its storage requirements.
 

Unisys is currently focusing on business opportunities in fewer but more profitable markets in the information technology (IT) marketplace. The company has identified and narrowed its focus around its core areas of strength -- namely Security, Data Center Transformation and Outsourcing, which includes its Technology business, End User Outsourcing and Application Modernization.
 

In the long run, we maintain a Neutral recommendation on Unisys. However, we have a Zacks No. 1 Rank on the stock, which translates into a short-term rating of "strong buy."

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