Loar Holdings Inc. (LOAR) vs Mercury Systems Inc (MRCY)

Loar Holdings Inc. and Mercury Systems Inc are both Aerospace & Defense companies. Loar Holdings Inc. is the larger, with a market value of $5.9B against $4.7B — 1.3× the size. Mercury Systems Inc has negative trailing earnings, so its P/E is not meaningful; Loar Holdings Inc. trades at 86.4×. Loar Holdings Inc. grew revenue faster over the last twelve months: 29.8% against 7.85%. Loar Holdings Inc. has the higher net margin (11.6% vs −3.02%) and the higher return on invested capital (3.95% vs 0.01%). Across the 19 metrics below, Loar Holdings Inc. leads on 14 and Mercury Systems Inc on 5.

Valuation

Metric LOAR MRCY Aerospace & Defense median
P/E 86.40 n/m 31.81
P/S 9.94 4.49 3.55
P/B 4.86 2.95 2.59
Price to free cash flow 54.94 64.86 31.99
EV/EBITDA 34.08 63.78 18.08
EV/Sales 11.35 4.73 3.37
Earnings yield 1.16% (0.67%) 1.38%
Free cash flow yield 1.82% 1.54% 0.21%

Profitability

Metric LOAR MRCY Aerospace & Defense median
Gross margin 52.18% 28.58% 25.48%
Operating margin 21.86% 0.03% 4.54%
Net margin 11.60% (3.02%) 2.22%
Free cash flow margin 18.09% 6.92% 1.43%
Return on equity 5.84% (2.00%) 6.43%
Return on assets 3.56% (1.25%) 2.70%
Return on invested capital 3.95% 0.01% 1.56%

Growth

Metric LOAR MRCY Aerospace & Defense median
Revenue growth (TTM) 29.76% 7.85% 18.43%
EPS growth (last fiscal year) 212.50% 23.08% 24.27%
Revenue growth, 5-year CAGR — 1.26% 9.73%
Net income growth, 5-year CAGR — 0.00% 0.00%

Health

Metric LOAR MRCY Aerospace & Defense median
Debt to equity 0.79 0.29 0.24
Current ratio 4.91 2.96 2.72
Net debt to EBITDA 4.01 3.11 1.12

Dividend

Metric LOAR MRCY Aerospace & Defense median
Dividend yield — — 0.90%
Payout ratio — — 0.32

Size

Metric LOAR MRCY Aerospace & Defense median
Market cap 5.88b 4.65b 2.19b

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