High-altitude drones will likely play a role in KEYW Holding Corp's new contract win. Image source: Getty Images.
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Shares of security company KEYW Holding Corp. (NASDAQ: KEYW) jumped 10.7% during the month of September after the company won a major contract.
Leidos Inc. has awarded KEYW Holding a contract valued at up to $268.5 million to support the Army Geospatial Center's High-Resolution, 3D Geospatial Information program. The contract has a base period worth $49.5 million annually and a four-year option as well.
This win demonstrates the company's improved capabilities in 3D imaging and data capture around the world. Leidos' program will use high-altitude aircraft to collect data, and KEYW will play a major role in developing and deploying the technology.
KEYW Holding generated $311.8 million in revenue during 2015, so this is a major contract win for the company. It remains to be seen if it will be enough to bring it to a positive net income position, but the extra revenue certainly won't hurt. I would like to see more progress beyond being around breakeven the last couple of quarters before getting too excited about a single contract win, but count last month's news as an incremental positive for the company.
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Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.