CSC’s share price is riding high and the Wall St analysts are almost wetting themselves as they pore over their spreadsheets and issue positive opinions and upgradesfor the company. Readers of this blog may recall that inMay and August 2009 in the “CSC results” postings we suggested the Analysts who were increasingly positive about CSC look at the business fundamentals rather than just its numbers.
It looks like history is repeating itself. While the analysts are writing about numbers, U.S. Defense Secretary Leon Panetta has been asked to explain why the Air Force scrapped a software system to manage its supply chain after spending more than $1 billion on it. And guess who had the contract which has been cancelled? Yes, it was CSC.
The project was described by Senator John McCain as “one of the most egregious examples of mismanagement in recent memory,”
Further details can be found on:http://www.bloomberg.com/news/2012-12-06/senators-question-air-force-s-1-billion-failed-software.html?cmpid=yhoo
It looks like a replay of the NHS fiasco. So what’s happening at CSC? Clients are unhappy, employees are talking about internal chaos and confusion. Meantime analysts are looking at spreadsheets and issuing glowing reports. Maybe they should get out of their offices and talk to CSC clients and employees to find out what is really happening.