Karman Holdings Inc. (KRMN) vs Mercury Systems Inc (MRCY)

Karman Holdings Inc. and Mercury Systems Inc are both Aerospace & Defense companies. Karman Holdings Inc. and Mercury Systems Inc are of similar size ($5.1B and $4.6B). Mercury Systems Inc has negative trailing earnings, so its P/E is not meaningful; Karman Holdings Inc. trades at 123×. Karman Holdings Inc. grew revenue faster over the last twelve months: 50.2% against 7.85%. Karman Holdings Inc. has the higher net margin (6.31% vs −3.02%) and the higher return on invested capital (5.09% vs 0.01%). Across the 18 metrics below, Karman Holdings Inc. leads on 11 and Mercury Systems Inc on 7.

Valuation

Metric KRMN MRCY Aerospace & Defense median
P/E 123.07 n/m 33.00
P/S 8.02 4.97 3.63
P/B 11.23 3.26 3.24
Price to free cash flow n/m 71.77 34.01
EV/EBITDA 35.42 70.22 18.69
EV/Sales 9.37 5.21 3.94
Earnings yield 0.81% (0.60%) 1.31%
Free cash flow yield (0.58%) 1.39% 0.00%

Profitability

Metric KRMN MRCY Aerospace & Defense median
Gross margin 41.67% 28.58% 25.48%
Operating margin 16.82% 0.03% 4.54%
Net margin 6.31% (3.02%) 2.22%
Free cash flow margin (4.63%) 6.92% 0.00%
Return on equity 9.50% (2.00%) 6.43%
Return on assets 3.10% (1.25%) 2.70%
Return on invested capital 5.09% 0.01% 1.56%

Growth

Metric KRMN MRCY Aerospace & Defense median
Revenue growth (TTM) 50.23% 7.85% 18.43%
EPS growth (last fiscal year) 62.50% 23.08% —
Revenue growth, 5-year CAGR — 1.26% 9.62%
Net income growth, 5-year CAGR — 0.00% 0.00%

Health

Metric KRMN MRCY Aerospace & Defense median
Debt to equity 2.01 0.29 0.24
Current ratio 3.56 2.96 2.72
Net debt to EBITDA 4.60 3.11 1.12

Dividend

Metric KRMN MRCY Aerospace & Defense median
Dividend yield — — 1.04%
Payout ratio — 0.00 0.00

Size

Metric KRMN MRCY Aerospace & Defense median
Market cap 4.64b 5.06b 2.52b

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