Mercury Systems (MRCY) Q3 Earnings: What To Expect

Aerospace and defense company Mercury Systems (NASDAQ:MRCY) will be reporting results tomorrow after market hours. Here’s what investors should know.

Mercury Systems beat analysts’ revenue expectations by 7.8% last quarter, reporting revenues of $248.6 million, down 1.8% year on year. It was an incredible quarter for the company, with an impressive beat of analysts’ organic revenue and earnings estimates.

Is Mercury Systems a buy or sell going into earnings? Read our full analysis here, it’s free.

This quarter, analysts are expecting Mercury Systems’s revenue to be flat year on year at $181.8 million, improving from the 20.5% decrease it recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.08 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 five times over the last two years.

Looking at Mercury Systems’s peers in the defense contractors segment, some have already reported their Q3 results, giving us a hint as to what we can expect. Leidos delivered year-on-year revenue growth of 6.9%, beating analysts’ expectations by 3%, and Leonardo DRS reported revenues up 15.5%, topping estimates by 4.7%. Leidos traded up 9.4% following the results while Leonardo DRS was also up 5.8%.

Read our full analysis of Leidos’s results here and Leonardo DRS’s results here.

Investors in the defense contractors segment have had steady hands going into earnings, with share prices flat over the last month. Mercury Systems is down 9.7% during the same time and is heading into earnings with an average analyst price target of $31.38 (compared to the current share price of $33.18).

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