I am neutral on Mercury Systems (MRCY). due to strong turnaround momentum, but a valuation that leaves little margin for error. MRCY is well-positioned for a multi-year defense upcycle, with record backlog, improved execution, and exposure to long-term modernization trends. The company's open-architecture platform and increasing defense outsourcing support future growth and margin expansion, but execution risks remain.
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Mercury Systems delivered strong Q4 and full-year results, with accelerated sales, improved margins, and significant EBITDA growth. FY26 will see low-single digit revenue growth, but solid margins and positive free cash flow are expected. Despite missing the initial rally, I am upgrading Mercury Systems from hold to buy, with a $86.50 price target and 30% upside potential.
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12 Aug 2025 Date | | 0.22 Cons. EPS | - EPS |
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4 Nov 2025 (In 1 month) Date | | 0.09 Cons. EPS | - EPS |
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12 Aug 2025 Date | | 0.22 Cons. EPS | - EPS |
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Aerospace & Defense Industry | Industrials Sector | William L. Ballhaus CEO | XSTU Exchange | US5893781089 ISIN |
US Country | 2,364 Employees | - Last Dividend | 21 Dec 1999 Last Split | 30 Jan 1998 IPO Date |
Mercury Systems, Inc., established in 1981 and rebranded from Mercury Computer Systems, Inc. in November 2012, operates as a pivotal technology entity within the aerospace and defense sectors. The company's footprint spans across the United States, Europe, and the Asia Pacific, servicing approximately 300 programs through collaborations with 25 defense contractors and commercial aviation customers. Anchored in Andover, Massachusetts, Mercury Systems is dedicated to the design, manufacture, and marketing of a wide array of components, products, modules, and subsystems tailored to meet the rigorous demands of its clientele in defense and aerospace industries.
Mercury Systems, Inc. provides a vast portfolio of products and services designed to address the multifaceted needs of the aerospace and defense industries: