Mercury Systems (MRCY) Q2 Earnings Report Preview: What To Look For

Aerospace and defense company Mercury Systems (NASDAQ:MRCY) will be reporting earnings this Monday afternoon. Here’s what you need to know.

Mercury Systems beat analysts’ revenue expectations by 4.6% last quarter, reporting revenues of $211.4 million, up 1.5% year on year. It was a strong quarter for the company, with an impressive beat of analysts’ organic revenue estimates and a solid beat of analysts’ EBITDA 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 decline 1.8% year on year to $244.2 million, in line with the 1.8% decrease it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.22 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 four 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. BWX delivered year-on-year revenue growth of 12.1%, beating analysts’ expectations by 7.2%, and General Dynamics reported revenues up 8.9%, topping estimates by 5.7%. BWX traded up 17.8% following the results while General Dynamics was also up 5.7%.

Read our full analysis of BWX’s results here and General Dynamics’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 up 5.8% during the same time and is heading into earnings with an average analyst price target of $52.71 (compared to the current share price of $53.91).

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