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

Mercury Systems Inc and VSE Corporation are both Aerospace & Defense companies. Mercury Systems Inc and VSE Corporation are of similar size ($4.7B and $4.5B). Mercury Systems Inc has negative trailing earnings, so its P/E is not meaningful; VSE Corporation trades at 51.8×. 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 15 and Mercury Systems Inc on 4.

Valuation

Metric MRCY VSEC Aerospace & Defense median
P/E n/m 51.83 31.81
P/S 4.49 3.72 3.55
P/B 2.95 1.72 2.59
Price to free cash flow 64.86 n/m 31.99
EV/EBITDA 63.78 32.36 18.08
EV/Sales 4.73 4.36 3.37
Earnings yield (0.67%) 1.93% 1.38%
Free cash flow yield 1.54% (0.02%) 0.21%

Profitability

Metric MRCY VSEC Aerospace & Defense median
Gross margin 28.58% 15.62% 25.48%
Operating margin 0.03% 9.15% 4.54%
Net margin (3.02%) 5.53% 2.22%
Free cash flow margin 6.92% (0.08%) 1.43%
Return on equity (2.00%) 3.84% 6.43%
Return on assets (1.25%) 2.50% 2.70%
Return on invested capital 0.01% 2.04% 1.56%

Growth

Metric MRCY VSEC Aerospace & Defense median
Revenue growth (TTM) 7.85% 41.55% 18.43%
EPS growth (last fiscal year) 23.08% 24.14% 24.27%
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 0.24
Current ratio 2.96 3.77 2.72
Net debt to EBITDA 3.11 1.71 1.12

Dividend

Metric MRCY VSEC Aerospace & Defense median
Dividend yield — 0.24% 0.90%
Payout ratio — 0.13 0.32

Size

Metric MRCY VSEC Aerospace & Defense median
Market cap 4.65b 4.53b 2.19b

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