New Award. Late last week, DLH announced it has been awarded a contract to provide experienced medical personnel to support COVID-19 community testing and collection, vaccination, and monoclonal antibody therapy throughout the state of Alaska. The award complements the September 23rd contract for emergency medical services in the state.Details. The contract, procured under a Federal Emergency Management Agency (FEMA) contract to provide support for states seeking medical support during the COVID-19 pandemic, has a ceiling value of $20 million for the 90-day base period. It provides for three one-month optional extensions after the initial period of performance. As the prime contractor, DLH will provide the emergency medical logistics coordination for the healthcare team fielded by its subcontractor, which will be responsible for a significant percentage of the services rendered.Additional Opportunity? We believe there remains additional potential opportunity under the FEMA program. States such as Michigan, Minnesota, and Montana, to name a few, are experiencing increasing cases and new admissions for COVID and high in-patient and ICU bed use.Updated Projections. We have increased our fiscal 2022 revenue estimate to $358.5 million to reflect the additional $20 million of expected revenue. We are maintaining our EBITDA estimate at $32 million to reflect a greater percentage of pass thru revenue on these contracts than previously anticipated.Raising PT to $16.50. We are raising our 12-month PT to $16.50 from a prior $14.00 and maintaining our Outperform rating. With the follow-up contract in Alaska and additional potential opportunities, we believe the risk/reward is positive. At our price target, DLHC shares would trade at 8.8x our fiscal 2022 adjusted EBITDA estimate and 0.8x our fiscal 2022 revenue estimate, still discounts to the peer group. Read More >>