The 10-second takeaway
For the quarter ended March 31 (Q3), Mercury Systems beat expectations on revenues and exceeded expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped significantly. Non-GAAP earnings per share dropped to a loss. GAAP earnings per share dropped significantly.
Margins shrank across the board.
Mercury Systems notched revenue of $54.1 million. The six analysts polled by S&P Capital IQ looked for sales of $47.5 million on the same basis. GAAP reported sales were 19% lower than the prior-year quarter's $67.0 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at -$0.02. The five earnings estimates compiled by S&P Capital IQ predicted -$0.04 per share. Non-GAAP EPS were -$0.02 for Q3 compared to $0.17 per share for the prior-year quarter. GAAP EPS of $0.03 for Q3 were 82% lower than the prior-year quarter's $0.17 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 41.7%, much worse than the prior-year quarter. Operating margin was -2.2%, much worse than the prior-year quarter. Net margin was 1.5%, 630 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $51.7 million. On the bottom line, the average EPS estimate is -$0.07.
Next year's average estimate for revenue is $199.3 million. The average EPS estimate is -$0.51.
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 48 members out of 110 rating the stock outperform, and 62 members rating it underperform. Among 35 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 15 give Mercury Systems a green thumbs-up, and 20 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Mercury Systems is hold, with an average price target of $8.75.
If you're interested in companies like Mercury Systems, you might want to check out the jaw-dropping technology that's about to put 100 million Chinese factory workers out on the street – and the 3 companies that control it. We'll tell you all about them in "The Future is Made in America." Click here for instant access to this free report.
- Add Mercury Systems to My Watchlist.