📊 MRCY Key Takeaways
Is MRCY a Good Investment? Thesis Analysis
Mercury Systems is experiencing profitability deterioration despite revenue growth, with negative operating and net margins indicating operational challenges. While the company maintains strong liquidity and positive free cash flow, the current loss-making position and negative return metrics suggest fundamental operational issues that outweigh the modest revenue growth.
Why Buy MRCY? Key Strengths
- Positive revenue growth of 9.2% YoY demonstrates market demand
- Strong liquidity position with 2.96x current ratio and $335M cash provides financial flexibility
- Positive operating cash flow of $53.8M and free cash flow of $41.3M showing cash generation capability despite losses
- Conservative leverage with 0.13x debt-to-equity ratio indicates low financial risk
MRCY Investment Risks to Consider
- Negative operating margin of -4.2% and net margin of -6.0% indicates the company is unprofitable at core operations
- Deteriorating returns with -1.9% ROE and -1.1% ROA suggest poor capital efficiency and shareholder value destruction
- Negative interest coverage of -1.2x reflects inability to cover interest expenses from operating income, raising debt sustainability concerns
- Net income loss of $27.6M despite revenue growth signals operational inefficiencies that may require restructuring
- Recent insider activity with 7 Form 4 filings in last 90 days warrants monitoring for insider sentiment
Key Metrics to Watch
- Path to operating profitability - operating margin must turn positive
- Operating cash flow sustainability - ensure FCF remains positive as losses continue
- Gross margin trend - verify if 27.0% margin is stable or declining
- Capital expenditure levels - monitor for necessary investments despite current losses
- Working capital management - track changes in current ratio as business evolves
MRCY Financial Metrics
💡 AI Analyst Insight
Strong liquidity with a 2.96x current ratio provides a solid financial cushion.
MRCY Profitability Ratios
MRCY vs Technology Sector
How MERCURY SYSTEMS INC compares to Technology sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is MRCY Overvalued or Undervalued?
Based on fundamental analysis, MERCURY SYSTEMS INC has mixed fundamental signals relative to the Technology sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
MRCY Balance Sheet & Liquidity
MRCY 5-Year Financial Trend & Growth Analysis
5-Year Trend Summary: MERCURY SYSTEMS INC's revenue has shown modest growth of 5% over the 5-year period. The most recent EPS of $-0.50 indicates the company is currently unprofitable.
MRCY Growth Metrics (YoY)
MRCY Quarterly Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q2 2026 | $223.1M | -$15.1M | $-0.26 |
| Q1 2026 | $204.4M | -$12.5M | $-0.21 |
| Q3 2025 | $208.3M | -$19.2M | $-0.33 |
| Q2 2025 | $197.5M | -$17.6M | $-0.30 |
| Q1 2025 | $181.0M | -$17.5M | $-0.30 |
| Q3 2024 | $208.3M | $5.2M | $0.09 |
| Q2 2024 | $197.5M | -$10.9M | $-0.19 |
| Q1 2024 | $181.0M | -$14.3M | $-0.26 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
MRCY Capital Allocation
MRCY SEC 10-K & 10-Q Filing Analysis
Access official SEC EDGAR filings for MERCURY SYSTEMS INC (CIK: 0001049521)
📋 Recent SEC Filings
❓ Frequently Asked Questions about MRCY
What is the AI rating for MRCY?
MERCURY SYSTEMS INC (MRCY) has an AI rating of SELL with 75% confidence, based on fundamental analysis of SEC EDGAR filings.
What are MRCY's key strengths?
Claude: Positive revenue growth of 9.2% YoY demonstrates market demand. Strong liquidity position with 2.96x current ratio and $335M cash provides financial flexibility.
What are the risks of investing in MRCY?
Claude: Negative operating margin of -4.2% and net margin of -6.0% indicates the company is unprofitable at core operations. Deteriorating returns with -1.9% ROE and -1.1% ROA suggest poor capital efficiency and shareholder value destruction.
What is MRCY's revenue and growth?
MERCURY SYSTEMS INC reported revenue of $458.1M.
Does MRCY pay dividends?
MERCURY SYSTEMS INC does not currently pay dividends.
Where can I find MRCY SEC filings?
Official SEC filings for MERCURY SYSTEMS INC (CIK: 0001049521) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is MRCY's EPS?
MERCURY SYSTEMS INC has a diluted EPS of $-0.47.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is MRCY a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, MERCURY SYSTEMS INC has a SELL rating with 75% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is MRCY stock overvalued or undervalued?
Valuation metrics for MRCY: ROE of -1.9% (sector avg: 22%), net margin of -6.0% (sector avg: 18%). Compare these metrics with sector averages to assess valuation.
Should I buy MRCY stock in 2026?
Our dual AI analysis gives MERCURY SYSTEMS INC a combined SELL rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is MRCY's free cash flow?
MERCURY SYSTEMS INC's operating cash flow is $53.8M, with capital expenditures of $12.5M. FCF margin is 9.0%.
How does MRCY compare to other Technology stocks?
Vs Technology sector averages: Net margin -6.0% (avg: 18%), ROE -1.9% (avg: 22%), current ratio 2.96 (avg: 2.5).