Mercury Systems Inc (MRCY) vs VSE Corporation (VSEC)

Mercury Systems Inc and VSE Corporation are both Aerospace & Defense companies. VSE Corporation is the larger, with a market value of $4.6B against $4.0B — 1.2× the size. Mercury Systems Inc has negative trailing earnings, so its P/E is not meaningful; VSE Corporation trades at 60.0×. VSE Corporation grew revenue faster over the last twelve months: 41.6% against 7.85%. VSE Corporation has the higher net margin (5.53% vs −3.02%) and the higher return on invested capital (2.04% vs 0.01%). Across the 19 metrics below, VSE Corporation leads on 13 and Mercury Systems Inc on 6.

Valuation

Metric MRCY VSEC Aerospace & Defense median
P/E n/m 59.96 28.48
P/S 3.97 3.78 2.95
P/B 2.61 1.75 2.68
Price to free cash flow 57.33 n/m 31.70
EV/EBITDA 56.75 32.83 16.85
EV/Sales 4.21 4.43 2.74
Earnings yield (0.75%) 1.67% 0.89%
Free cash flow yield 1.74% (0.02%) 0.00%

Profitability

Metric MRCY VSEC Aerospace & Defense median
Gross margin 28.58% 15.62% 26.41%
Operating margin 0.03% 9.15% 3.69%
Net margin (3.02%) 5.53% 2.74%
Free cash flow margin 6.92% (0.08%) 0.00%
Return on equity (2.00%) 3.84% 4.44%
Return on assets (1.25%) 2.50% 1.90%
Return on invested capital 0.01% 2.04% 0.26%

Growth

Metric MRCY VSEC Aerospace & Defense median
Revenue growth (TTM) 7.85% 41.55% 18.03%
EPS growth (last fiscal year) 23.08% (35.29%) 24.80%
Revenue growth, 5-year CAGR 1.26% 10.95% 9.73%
Net income growth, 5-year CAGR 0.00% 0.00% 0.00%

Health

Metric MRCY VSEC Aerospace & Defense median
Debt to equity 0.29 0.32 0.20
Current ratio 2.96 3.77 2.85
Net debt to EBITDA 3.11 1.71 1.29

Dividend

Metric MRCY VSEC Aerospace & Defense median
Dividend yield — 0.24% 0.91%
Payout ratio — 0.15 0.30

Size

Metric MRCY VSEC Aerospace & Defense median
Market cap 3.99b 4.62b 1.78b

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