Mercury Systems’ MRCY shares appreciated 22.7% in the trailing six months, outperforming the Zacks Aerospace sector and the Zacks Aerospace – Defense Equipment Industry, and its peers, including Hexcel HXL, AAR AIR and Woodward WWD.

Over the same timeframe, shares of Hexcel, AAR and Woodward have returned 11.3%, 8.4%, and 7%, respectively. Meanwhile, the sector and the industry have returned 7.3% and 20.4%, respectively.

Mercury Systems’ positive share price movement reflects its ability to deliver consistent organic growth alongside expanding margins. MRCY is well-positioned to benefit from advancements in radar, electronic warfare and C4I systems, opening doors to opportunities in weapon systems, space technologies, avionics processing, mission computing and rugged embedded solutions.

These modernization efforts are set to fuel growth as the company applies its expertise to deliver innovative solutions for evolving industry demands.

Contracts Wins & Market Expansion Drive MRCY’s Prospects

Mercury Systems received a major follow-on order from a prime contractor for FPGA processor boards. These boards will be used in a key U.S. Air Force program, with MRCY already having delivered hundreds of boards for testing. Under the new contract, the company will supply around 1,500 production boards.

MRCY secured another significant order for a multi-chip module, which is also part of a key U.S. Air Force program. Mercury Systems is the sole supplier of this device, further strengthening its role in the project.

The company received a large manufacturing order to produce RF solutions for a missile defense system used in multiple regions to protect against threats. It also secured a five-year contract worth up to $131.3 million from the U.S. Naval Air Systems Command to continue providing secure data transfer systems for naval aircraft.

MRCY collaborated with Lockheed Martin to advance defense manufacturing capabilities in Switzerland. This partnership aims to produce embedded computing technologies at Mercury Systems' Geneva facility, enhancing its footprint in the European defense sector.

Mercury Systems is capitalizing on modernization efforts in radar, electronic warfare and C4I systems, creating opportunities in weapon systems, space technologies, avionics processing, mission computing and embedded solutions.

MRCY’s Estimates Trend Upward

For the third quarter of fiscal 2025, the Zacks Consensus Estimate for earnings is pegged at 7 cents per share, up by a couple of cents over the past 60 days. The estimate indicates a year-over-year upsurge of 126.92%.

The Zacks Consensus Estimate for third-quarter fiscal 2025 revenues is pegged at $210.09 million, suggesting a 0.88% increase from the year-ago quarter’s reported figure.

The Zacks Consensus Estimate for 2025 revenues is pegged at $848.94 million, indicating year-over-year growth of 1.64%.

The consensus mark for earnings is pegged at 31 cents per share, up 40.9% over the past 60 days. The estimate indicates a year-over-year surge of 144.93%.

Over the trailing four quarters, the company’s earnings beat the Zacks Consensus Estimate twice and missed in the remaining two, the average negative surprise being 53.50%.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Zacks Rank

MRCY currently sports a Zacks Rank #1 (Strong Buy), which implies that investors should start accumulating the stock right away. You can see the complete list of today’s Zacks #1 Rank stocks here.

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