Aerospace and defense company Mercury Systems (NASDAQ: MRCY) will be announcing earnings results this Tuesday after market close. Here’s what to look for.
Mercury Systems beat analysts’ revenue expectations by 11.9% last quarter, reporting revenues of $273.1 million, up 9.9% year on year. It was an incredible quarter for the company, with a solid beat of analysts’ organic revenue estimates and a beat of analysts’ EPS estimates.
Is Mercury Systems a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, analysts are expecting Mercury Systems’s revenue to be flat year on year at $205.7 million, slowing from the 13% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.09 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Mercury Systems has missed Wall Street’s revenue estimates three times over the last two years.
Looking at Mercury Systems’s peers in the defense contractors segment, some have already reported their Q3 results, giving us a hint as to what we can expect. RTX delivered year-on-year revenue growth of 11.9%, beating analysts’ expectations by 5.4%, and General Dynamics reported revenues up 10.6%, topping estimates by 3.1%. RTX traded up 10.8% following the results while General Dynamics was also up 3.5%.
Read our full analysis of RTX’s results here and General Dynamics’s results here.
Investors in the defense contractors segment have had steady hands going into earnings, with share prices flat over the last month. Mercury Systems is down 7.8% during the same time and is heading into earnings with an average analyst price target of $81.13 (compared to the current share price of $77.41).
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