William_Potter In May, I analyzed Mercury Systems, Inc. and attached a hold rating to the stock with a $42.15 price target with FY26 eamings in mind against a peer group valuation and $42.91 with FY25 earnings in mind against the company median EV/EBITDA valuation. The company presented its fourth quarter results resently and the stock surged 17% to $40. I had a hold rating on the stock and perhaps that should have been a buy rating, but I was not impressed with the risk profile. In this report, I will be d ...

U.S. stocks traded mixed toward the end of trading, with the Dow Jones index gaining around 250 points on Wednesday. The Dow traded up 0.65% to 40,022.71 while the NASDAQ fell 0.20% to 17,153.85. The S&P 500 also rose, gaining, 0.24% to 5,447.57. Leading and Lagging Sectors Financials shares climbed by 1.1% on Tuesday. In trading on Tuesday, communication services shares fell 1.3%. Top Headline UBS Group AG UBS posted strong second-quarter earnings. UBS Group reported second-quarter FY24 sales of $11.9 bill ...

Aerospace and defense specialist Mercury Systems (NASDAQ:MRCY) — which offers advanced components, circuits, semiconductors and modules, among many other product categories — saw its shares skyrocket over 20% on Wednesday. Encouraging results tied to its fiscal fourth-quarter earnings disclosure are catapulting sentiment. Additionally, MRCY stock has benefited from surging relevancies in unmanned systems, one of Mercury's specialties. Earlier today, Mercury posted a net loss of $10.8 million or 19 cents a s ...

A strong fiscal fourth quarter has investors excited about what is to come. Defense electronics company Mercury Systems (MRCY 19.65%) reported a better-than-expected quarter, and management is confident the momentum can be sustained into the new fiscal year. Investors are excited, sending Mercury shares up 22% as of 11 a.m. ET on Wednesday. Turning a corner after a rough few years Mercury manufactures sensors, communications equipment, and other electronics components for the aerospace and defense industrie ...

Mercury Systems (MRCY) reported fourth-quarter fiscal 2024 results, wherein both top and bottom lines beat the Zacks Consensus Estimate. The aerospace and defense tech firm reported non-GAAP earnings of 23 cents per share against the Zacks Consensus Estimate of a loss of 7 cents. The bottom line surged 109.1% year over year. Mercury Systems' non-GAAP revenues decreased 1.8% to $248.6 million. The top line beat the consensus mark by 11.7%. The results reflected solid progress in each of the priority focus ar ...

Mercury Systems (MRCY) reported $248.56 million in revenue for the quarter ended June 2024, representing a year-over-year decline of 1.9%. EPS of $0.23 for the same period compares to $0.11 a year ago. The reported revenue represents a surprise of +11.07% over the Zacks Consensus Estimate of $223.8 million. With the consensus EPS estimate being -$0.07, the EPS surprise was +428.57%. While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wa ...

Financial Data and Key Metrics Changes - In Q4 FY '24, the company reported bookings of $284 million, resulting in a book-to-bill ratio of 1.14, and a full-year book-to-bill of 1.22, indicating strong demand [7][24] - Q4 revenue was $249 million, slightly down 2% year-over-year, while full-year revenue was $835 million, a decline of 14% compared to the previous year [17][24] - Adjusted EBITDA for Q4 was $31.2 million, up 42% year-over-year, while full-year adjusted EBITDA decreased to $9.4 million from $132.3 million in the prior year [23][26] - Free cash flow in Q4 reached $61.4 million, marking the highest quarterly free cash flow in the company's history, compared to $3.8 million in the prior year [23][29] Business Line Data and Key Metrics Changes - The company made significant progress in its four priority areas, including delivering predictable performance, driving organic growth, expanding margins, and improving free cash flow [5][8] - The backlog increased to a record $1.3 billion, up 16% year-over-year, with approximately 80% of firm fixed-price bookings being production-related [11][24] - The company retired risk on 13 of the original 19 challenged programs, with plans to ramp up production in the first half of FY '25 [10][14] Market Data and Key Metrics Changes - The company noted strong demand in growth markets, including sensors, electronic warfare, avionics, and C4I, which align with customer priorities [11] - The company is experiencing a shift towards production bookings, with 80% of firm fixed-price bookings being production in nature, indicating a positive trend in market positioning [11][36] Company Strategy and Development Direction - The company aims to achieve above-market top-line growth, adjusted EBITDA margins in the low-to-mid 20% range, and free cash flow conversion of 50% [14][42] - The focus for FY '25 includes reducing working capital and transitioning from a high mix of development programs to a more balanced production program mix [15][42] - The company is optimistic about its strategic positioning as a leader in mission-critical processing at the edge, with expectations for predictable organic growth and expanding margins [7][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver results in line with its target profile, despite not providing specific guidance for FY '25 [14][15] - The company anticipates that the first half of FY '25 will be relatively flat year-over-year, with an increase in run rate as operational capacity shifts towards production programs [15][16] - Management highlighted the importance of successful execution of development programs and the ramp-up of production as key factors influencing future performance [34][36] Other Important Information - The company ended Q4 with $181 million in cash after paying down $25 million of debt, with total funded debt at $592 million [27] - Working capital decreased by approximately $93 million year-over-year, reflecting efforts to reverse the trend of growth in working capital [28] Q&A Session Summary Question: Details on the Common Processing Architecture (CPA) programs - Management confirmed confidence in ramping up to full rate production in the first half of FY '25, with significant progress made in reliability testing and corrective actions [30] Question: Factors influencing FY '25 results - Management discussed visibility improvements due to a record backlog and progress in reducing volatility and improving cost structure, with a focus on development program execution [32][34] Question: Transitioning to a 20:80 split of development to production programs - Management indicated that the transition is expected to occur over the next 12 months, with a focus on pursuing new business opportunities while managing risk appropriately [36] Question: Impact of CPA-related programs on margins - Management stated that CPA-related programs are not expected to be margin dilutive and may even be additive due to strong market demand [37] Question: Expectations for EBITDA margins in FY '25 - Management expects to start FY '25 with high single-digit EBITDA margins, improving in the second half as backlog transitions and volume increases [39][40] Question: Tracking unbilled receivables and KPIs for FY '25 - Management emphasized the importance of KPIs related to top-line growth, margin improvement, and free cash flow conversion as indicators of progress in FY '25 [42]

Core Insights - Mercury Systems, Inc. reported a fourth quarter FY24 revenue of $248.6 million, a decrease from $253.2 million in the same quarter of FY23, with total bookings of $284.4 million, resulting in a book-to-bill ratio of 1.14 [4][5][8] - The company achieved a record backlog of $1.3 billion, reflecting a 16% year-over-year increase [3][10] - For FY24, the company reported total revenues of $835.3 million, down from $973.9 million in FY23, with total bookings of $1.02 billion and a book-to-bill ratio of 1.22 [8][9] Financial Performance - The GAAP net loss for Q4 FY24 was $10.8 million, or $0.19 per share, compared to a net loss of $8.2 million, or $0.15 per share, in Q4 FY23 [5][20] - Adjusted EBITDA for Q4 FY24 was $31.2 million, an increase from $21.9 million in Q4 FY23 [6][38] - Free cash flow for Q4 FY24 was $61.4 million, significantly up from $3.8 million in Q4 FY23 [7][41] Operational Highlights - The company made progress in addressing challenges in its business, focusing on mission-critical processing and organic growth with expanding margins [2][3] - Cash flows from operating activities in Q4 FY24 were $71.8 million, compared to $12.6 million in Q4 FY23 [7][41] - The company reversed a multi-year trend of growth in working capital, producing a record free cash flow [3] Yearly Overview - For FY24, the company reported a GAAP net loss of $137.6 million, or $2.38 per share, compared to a net loss of $28.3 million, or $0.50 per share, in FY23 [9][46] - Adjusted EPS for FY24 was ($0.69), down from $1.00 in FY23 [9][46] - The total backlog at the end of FY24 was $1.33 billion, with $758.9 million expected to be recognized as revenue within the next 12 months [10]

ANDOVER, Mass., Aug. 12, 2024 (GLOBE NEWSWIRE) -- Mercury Systems, Inc. (NASDAQ: MRCY, www.mrcy.com), a technology company that delivers mission-critical processing power to the edge, today announced the appointment of Brad Whittington as its Senior Vice President of Engineering, effective Aug. 12, 2024. Reporting to Chief Operating Officer Roger Wells, Whittington is responsible for the strategic planning, leadership, and execution of Mercury's recently integrated Engineering organization. Whittington has ...

Mercury Systems, Inc. MRCY is expected to release earnings results for its fourth quarter, after the closing bell on Tuesday, Aug. 13. Analysts expect the Andover, Massachusetts-based company to report quarterly earnings at 2 cent per share, versus a year-ago profit of 11 cents per share. Mercury Systems is projected to report quarterly revenue of $230.69 million, compared to $253.24 million a year earlier, according to data from Benzinga Pro. On June 18, Mercury named Tod Brindlinger as Senior Vice Preside ...