NASDAQ$MRCY

Mercury Systems Inc · Q3 2021 earnings

Q3 2021 earnings · · Investor relations

Briefing

Mercury Systems reported strong financial performance driven by record revenues and the successful integration of Physical Optics Corporation.

Mercury Systems reported a strong Q3 fiscal 2021 with record revenues of $256.9 million, a 23% increase year-over-year. GAAP net income was $15.6 million, or $0.28 per share, while adjusted EPS was $0.64. The company's backlog increased to $893.7 million.

  • Record revenues increased 23% over the prior year.
  • Backlog of $894 million increased 16% over the prior year.
  • Physical Optics Corporation integration is progressing well.
  • The company delivered a strong financial performance in the third quarter.

Headline financials

Total Revenue

$257M

Previous: $208M+23.5%
EPS (adj)

$0.64

Previous: $0.60+6.7%
Total Backlog

$894M

No prior period
Capital Expenditures

-$34.7M

Previous: -$31.8M-9.2%
Free Cash Flow

-$19.1M

Previous: -$8.22M-131.9%
Net Income

$15.6M

Previous: $23.6M-33.7%
Operating Income

$21.7M

Previous: $26.3M-17.6%
Gross Profit

$106M

Previous: $93.3M+13.2%
Cash & Equivalents

$122M

Previous: $407M-70.0%
Total Assets

$1.9B

Previous: $1.77B+7.4%
Stock-Based Comp

$7.41M

Previous: $6.81M+8.8%

Revenue & EPS history

Mercury · Revenue · Quarterly

$257M

Q3 2021+23.5%vs Q3 2020
Beat estimate in 14 of 16 quarters(88%)
ActualEstimate

Forward guidance

For the fourth quarter of fiscal 2021, Mercury Systems forecasts revenues in the range of $236.5 million to $246.5 million and GAAP net income of $19.5 million to $20.9 million, or $0.35 to $0.38 per share. Adjusted EPS is expected to be in the range of $0.66 to $0.69 per share.

Tailwinds

  • Revenues are forecasted to be in the range of $236.5 million to $246.5 million.
  • GAAP net income for the fourth quarter is expected to be approximately $19.5 million to $20.9 million, or $0.35 to $0.38 per share.
  • Adjusted EBITDA for the fourth quarter of fiscal 2021 is expected to be in the range of $58.1 million to $60.0 million.
  • Adjusted EPS is expected to be in the range of $0.66 to $0.69 per share.
  • For the full fiscal year 2021, revenues are forecasted to be in the range of $910.0 million to $920.0 million.

Headwinds

  • GAAP net income of $63.5 million to $64.9 million, or $1.14 to $1.17 per share, assuming no incremental restructuring, acquisition, other non-operating adjustments, non-recurring financing in the period.
  • Effective tax rate, excluding discrete items, of approximately 26% for the remainder of the year.
  • Approximately 55.5 million weighted average diluted shares outstanding.
  • Adjusted EBITDA for the full fiscal year is expected to be approximately $201.0 million to $203.0 million.
  • Adjusted EPS for the full fiscal year is expected to be approximately $2.35 to $2.37 per share.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2021

Historical avgQ3 2021

+0.8%

Avg return

Earnings day

+0.7%

Avg return

5 days after

+3.8%

Avg return

30 days after

52%

33 / 64 earnings

Positive

+27.0%

Q1 2025

Best reaction

-23.7%

Q3 2021

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q3 2026+16.8%+10.8%+34.0%
Q2 2026-18.9%-14.0%-13.0%
Q1 2026+3.4%-1.4%-6.8%
Q3 2025-4.9%-7.8%+5.4%
Q2 2025+18.5%+11.6%+4.2%
Q1 2025+27.0%+28.4%+15.4%
Q4 2024+17.9%+18.1%+8.5%
Q3 2024-1.4%-4.1%+3.4%
Q2 2024-11.5%-3.3%+1.4%
Q1 2024-13.5%-12.9%-2.8%
Q4 2023+3.2%+7.1%+8.4%
Q3 2023-19.7%-13.9%-13.8%
Q2 2023+14.8%+12.9%+9.1%
Q1 2023+3.4%-0.7%+6.4%
Q4 2022-16.1%-14.1%-21.0%
Q3 2022+4.9%+1.0%+11.4%
Q2 2022-8.5%-8.5%+21.1%
Q1 2022+0.3%-1.1%-8.6%
Q4 2021-14.3%-14.3%-23.8%
Q3 2021-23.7%-15.1%-13.3%
Q2 2021+0.2%+6.1%-10.0%
Q1 2021-1.4%-3.0%+0.1%
Q4 2020+0.0%+0.5%-5.3%
Q3 2020+9.3%+2.0%+4.5%
Q2 2020+2.6%+1.6%+5.2%
Q1 2020-1.8%+3.2%+1.8%
Q4 2019+17.5%+15.1%+23.1%
Q3 2019+2.5%+1.7%-3.6%
Q2 2019+18.8%+18.5%+29.6%
Q1 2019+7.6%+10.2%+16.9%
Q4 2018+22.6%+19.9%+35.3%
Q3 2018-23.1%-27.3%-20.0%
Q2 2018-4.4%-5.4%-5.9%
Q1 2018-3.4%-3.4%+1.0%
Q4 2017-0.9%+0.7%+9.9%
Q3 2017-5.8%-5.9%+1.6%
Q2 2017+9.4%+9.9%+21.9%
Q1 2017+13.6%+14.5%+29.8%
Q4 2016-1.6%-9.5%-11.4%
Q3 2016+4.8%
Q2 2016+12.9%
Q1 2016+5.7%
Q4 2015+9.7%
Q3 2015-4.1%
Q2 2015+4.7%
Q1 2015+13.6%
Q4 2014-0.6%
Q3 2014+5.3%
Q2 2014+0.0%
Q1 2014+2.9%
Q4 2013+1.3%
Q3 2013+5.8%
Q2 2013-6.7%
Q1 2013-2.8%
Q4 2010-2.0%
Q4 2012-15.8%
Q3 2011-6.3%
Q3 2012+4.5%
Q2 2011-1.3%
Q2 2012-10.2%
Q4 2011-2.6%
Q1 2011-2.6%
Q1 2012+4.1%
Q3 2010-8.5%

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