Stock Story -
Aerospace and defense company Mercury Systems (NASDAQGS:MRCY) will be reporting results tomorrow after the bell. Here's what to look for.
Mercury Systems missed analysts' revenue expectations by 2.9% last quarter, reporting revenues of $208.3 million, down 21% year on year. It was a weak quarter for the company, with a miss of analysts' earnings and organic revenue estimates.
Is Mercury Systems a buy or sell going into earnings? Find out by reading the original article on StockStory, it's free.
This quarter, analysts are expecting Mercury Systems's revenue to decline 9% year on year to $230.5 million, improving from the 12.6% decrease it recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.04 per share.
The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Mercury Systems has missed Wall Street's revenue estimates six times over the last two years.
Looking at Mercury Systems's peers in the defense contractors segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Leonardo DRS delivered year-on-year revenue growth of 19.9%, beating analysts' expectations by 10.7%, and Huntington Ingalls reported revenues up 6.8%, topping estimates by 4.7%. Leonardo DRS's stock price was unchanged after the resultswhile Huntington Ingalls was down 5.9%.
Read the full analysis of Leonardo DRS's and Huntington Ingalls's results on StockStory.
Growth stocks have seen elevated volatility as investors debate the Fed's monetary policy, and while some of the defense contractors stocks have fared somewhat better, they have not been spared, with share prices down 5.4% on average over the last month. Mercury Systems is up 8.9% during the same time and is heading into earnings with an average analyst price target of $25.8 (compared to the current share price of $35.31).
