Analyzing Mercury Systems (MRCY) and Lockheed Martin Corporation (LMT)
Mercury Systems (NASDAQ: MRCY) and Lockheed Martin Corporation (NYSE:LMT) are both mid-cap computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, dividends, valuation, institutional ownership, analyst recommendations, earnings and risk.
Volatility & Risk
Mercury Systems has a beta of 0.41, indicating that its share price is 59% less volatile than the S&P 500. Comparatively, Lockheed Martin Corporation has a beta of 0.6, indicating that its share price is 40% less volatile than the S&P 500.
This is a summary of recent ratings for Mercury Systems and Lockheed Martin Corporation, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Lockheed Martin Corporation||0||6||9||0||2.60|
Mercury Systems currently has a consensus price target of $50.20, indicating a potential downside of 0.53%. Lockheed Martin Corporation has a consensus price target of $316.57, indicating a potential upside of 2.73%. Given Lockheed Martin Corporation’s higher possible upside, analysts clearly believe Lockheed Martin Corporation is more favorable than Mercury Systems.
This table compares Mercury Systems and Lockheed Martin Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Lockheed Martin Corporation||7.31%||221.41%||7.65%|
Lockheed Martin Corporation pays an annual dividend of $7.28 per share and has a dividend yield of 2.4%. Mercury Systems does not pay a dividend. Lockheed Martin Corporation pays out 58.6% of its earnings in the form of a dividend. Mercury Systems has raised its dividend for 14 consecutive years.
Valuation and Earnings
This table compares Mercury Systems and Lockheed Martin Corporation’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Mercury Systems||$408.59 million||5.94||$77.23 million||$0.86||58.69|
|Lockheed Martin Corporation||$49.05 billion||1.80||$6.23 billion||$12.43||24.79|
Lockheed Martin Corporation has higher revenue and earnings than Mercury Systems. Lockheed Martin Corporation is trading at a lower price-to-earnings ratio than Mercury Systems, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
96.4% of Mercury Systems shares are owned by institutional investors. Comparatively, 79.0% of Lockheed Martin Corporation shares are owned by institutional investors. 3.5% of Mercury Systems shares are owned by insiders. Comparatively, 0.4% of Lockheed Martin Corporation shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Lockheed Martin Corporation beats Mercury Systems on 9 of the 17 factors compared between the two stocks.
Mercury Systems Company Profile
Mercury Systems, Inc. is a commercial provider of secure processing subsystems designed and made in the United States. The Company’s solutions support a range of defense and intelligence programs. Its technologies include embedded processing modules and subsystems, radio frequency (RF) and microwave multi-function assemblies, as well as subsystems, and RF and microwave components. It designs and builds RF and microwave components and subsystems for the electronic warfare (EW), signals intelligence (SIGINT) and other communications requirements and applications. It offers analyst services and systems engineering support, consulting, maintenance and other support, testing and installation. It designs, markets and sells software and middleware environments for the development and execution of signal and image processing applications on a range of heterogeneous and multi-computing platforms. It also offers solutions in mission computing, safety-critical avionics and platform management.
Lockheed Martin Corporation Company Profile
Lockheed Martin Corporation is a security and aerospace company. The Company operates through four segments. Aeronautics segment is engaged in the research, design, development, manufacture, integration, sustainment, support and upgrade of military aircraft, including combat and air mobility aircraft, unmanned air vehicles and related technologies. Missiles and Fire Control segment provides air and missile defense systems; fire control systems; manned and unmanned ground vehicles, and energy management solutions. Rotary and Mission Systems segment provides design, manufacture, service and support for a range of military and civil helicopters; mission systems and sensors for rotary and fixed-wing aircraft; simulation and training services, and unmanned systems and technologies, among others. Space Systems segment is engaged in the research and development, design, engineering and production of satellites, strategic and defensive missile systems and space transportation systems.
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