Mercury Systems provides open sensor processing systems and services. The company operates through two segments, Mercury Commercial Electronics (MCE) and Mercury Defense Systems (MDS). The company was founded in 1981 and is based in Chelmsford, Massachusetts.
MRCY Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for MRCY, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Mercury Systems Inc ranked in the 47th percentile in terms of potential gain offered. More precisely, our analysis suggests the stock is undervalued by approximately 27.5% on a DCF basis. In terms of the factors that were most noteworthy in this DCF analysis for MRCY, they are:
The company's balance sheet shows it gets 99% of its capital from equity, and 1% of its capital from debt. Notably, its equity weight is greater than 95.7% of US equities in the Industrials sector yielding a positive free cash flow.
The business' balance sheet suggests that 1% of the company's capital is sourced from debt; this is greater than only 6.09% of the free cash flow producing stocks we're observing.
MRCY's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 62.28% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Industrials that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as MRCY, try CSWI, RTN, EME, GTMAY, and HUBB.