Motivated by measurements on stretched double-stranded DNA in the presence of multivalent cations, we develop a statistical mechanical model for the compaction of an insoluble semiflexible polymer under tension. Using a mean-field approach, we determine the order of the extended-to-compact transition and provide an interpretation for the magnitude and interval of tensions over which compaction takes place. In the simplest thermodynamic limit of an infinitely long homogeneous polymer, compaction is a first-order transition that occurs at a single value of tension. For finite length chains or for heterogeneous polymers, the transition progresses over an interval of tension. Our theory provides an interpretation for the result of single-molecule experiments in terms of microscopic parameters such as persistence length and free energy of condensation.