* Government awards loan-servicing contract

* Analyst says contract can provide "meaningful" growth

* Sallie Mae rises 5.5 percent, Nelnet 32.2 percent

* ACS, which missed out on contract, falls 3.7 percent (Adds ACS comment, closing prices)

By Jonathan Stempel

NEW YORK, June 18 (Reuters) - Sallie Mae (SLM.N: Quote, Profile, Research) and Nelnet Inc (NNI.N: Quote, Profile, Research) shares soared on Thursday after the U.S. Department of Education awarded them and two other companies a contract to service $550 billion of federal student loans.

The contract, announced on Wednesday, should help the lenders offset potential revenue losses if the government adopts President Barack Obama's proposal to stop subsidizing private lenders, and instead make the loans directly to students.

It was not immediately clear how much business and fees each company will get, but the Education Department said it plans to acquire a "large volume" of federally guaranteed loans in the coming months. The five-year contract is expected to begin in August and may be renewed for another five years.

"This will prove to be a meaningful source of growth for both Sallie Mae and Nelnet over the years to come," wrote Matt Snowling, an analyst at FBR Capital Markets who rates both companies "outperform."