Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, defense contractor ManTech
With that in mind, let's take a closer look at ManTech's business and see what CAPS investors are saying about the stock right now.
|Headquarters (Founded)||Fairfax, Va. (1968)|
|Market Cap||$1.12 billion|
|Industry||Security software and services|
|Trailing-12-Month Revenue||$2.81 billion|
Co-Founder/Chairman/CEO George Pedersen
CFO Kevin Phillips
|Return on Equity (Average, Past 3 Years)||14.5%|
|Cash/Debt||$207 million / $200 million|
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
Earlier this week, robertshrestha listed several of ManTech's positives: "Beaten down big time, small defense player with room to grow, healthy balance sheet, decent dividend, nicely positioned portfolio."
In fact, ManTech currently sports a particularly paltry price-to-cash flow of 2.9. That represents a clear discount to much larger defense contractors like Boeing
CAPS member MagicDiligence elaborated on the bull case on Aug. 31:
When reviewing ManTech, it was striking to me that its portfolio of services are exactly where nearly all of the big 5 are trying to expand into. ...
The financial picture is also a positive. ManTech's balance sheet is minimally levered, with just a 19% debt-to-equity ratio (anything under 50% is great), and operating earnings covering interest 15 times over. The company this year just started paying a dividend that yields 2.3%, and represents less than 20% of free cash flow. With a stable business and steady cash flows, the dividend is well supported and has room to grow. ...
In all, like pretty much all the defense contractors, ManTech looks oversold. Even assuming well below historic 3% growth rates going forward (trailing 5-year growth rate is 15%), and below historic P/E and P/S (price-to-sales) multiples, ManTech looks worth $60 to me -- a massive discount to current sub-$40 share prices.
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