Intrinsic value of Mercury Systems - MRCY

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$39.61

  Intrinsic Value

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  Rating & Target

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  Value-price divergence*

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Previous close

$39.61

 
Intrinsic value

$25.88

 
Up/down potential

-35%

 
Rating

sell

 
Value-price divergence* premium content

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*Intrinsic value change (in %) minus stock price change (in %) in the past 12 months.

We calculate the intrinsic value of MRCY stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 2016), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 1.6

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  14.89
  60.00
  54.50
  49.55
  45.10
  41.09
  37.48
  34.23
  31.31
  28.68
  26.31
  24.18
  22.26
  20.53
  18.98
  17.58
  16.32
  15.19
  14.17
  13.26
  12.43
  11.69
  11.02
  10.42
  9.87
  9.39
  8.95
  8.55
  8.20
  7.88
  7.59
Revenue, $m
  270
  432
  667
  998
  1,448
  2,043
  2,809
  3,771
  4,951
  6,371
  8,047
  9,992
  12,217
  14,725
  17,520
  20,600
  23,963
  27,604
  31,516
  35,693
  40,130
  44,819
  49,758
  54,941
  60,366
  66,032
  71,941
  78,095
  84,497
  91,154
  98,073
Variable operating expenses, $m
 
  349
  521
  762
  1,090
  1,523
  2,081
  2,782
  3,642
  4,676
  5,897
  7,280
  8,901
  10,729
  12,765
  15,009
  17,459
  20,112
  22,962
  26,006
  29,238
  32,655
  36,253
  40,029
  43,982
  48,111
  52,416
  56,899
  61,564
  66,414
  71,455
Fixed operating expenses, $m
 
  15
  16
  16
  17
  17
  17
  18
  18
  19
  19
  20
  20
  21
  21
  22
  22
  23
  23
  24
  25
  25
  26
  26
  27
  28
  29
  29
  30
  31
  31
Total operating expenses, $m
  246
  364
  537
  778
  1,107
  1,540
  2,098
  2,800
  3,660
  4,695
  5,916
  7,300
  8,921
  10,750
  12,786
  15,031
  17,481
  20,135
  22,985
  26,030
  29,263
  32,680
  36,279
  40,055
  44,009
  48,139
  52,445
  56,928
  61,594
  66,445
  71,486
Operating income, $m
  24
  67
  131
  220
  342
  503
  711
  971
  1,291
  1,676
  2,130
  2,692
  3,295
  3,976
  4,734
  5,569
  6,482
  7,469
  8,530
  9,663
  10,867
  12,139
  13,479
  14,885
  16,357
  17,894
  19,497
  21,166
  22,903
  24,709
  26,586
EBITDA, $m
  40
  108
  176
  270
  399
  569
  788
  1,063
  1,401
  1,808
  2,288
  2,845
  3,482
  4,201
  5,002
  5,884
  6,848
  7,891
  9,012
  10,209
  11,480
  12,824
  14,239
  15,724
  17,279
  18,903
  20,596
  22,359
  24,194
  26,102
  28,085
Interest expense (income), $m
  1
  6
  12
  19
  30
  45
  65
  90
  122
  161
  207
  263
  327
  400
  483
  575
  676
  787
  907
  1,036
  1,174
  1,320
  1,475
  1,638
  1,808
  1,987
  2,174
  2,369
  2,572
  2,783
  3,002
Earnings before tax, $m
  25
  61
  119
  201
  312
  458
  646
  881
  1,169
  1,515
  1,923
  2,430
  2,969
  3,576
  4,251
  4,994
  5,805
  6,682
  7,623
  8,627
  9,693
  10,819
  12,004
  13,247
  14,548
  15,907
  17,323
  18,798
  20,332
  21,927
  23,584
Tax expense, $m
  5
  16
  32
  54
  84
  124
  174
  238
  316
  409
  519
  656
  802
  965
  1,148
  1,348
  1,567
  1,804
  2,058
  2,329
  2,617
  2,921
  3,241
  3,577
  3,928
  4,295
  4,677
  5,075
  5,490
  5,920
  6,368
Net income, $m
  20
  45
  87
  147
  228
  334
  471
  643
  854
  1,106
  1,404
  1,774
  2,167
  2,610
  3,103
  3,646
  4,238
  4,878
  5,565
  6,298
  7,076
  7,898
  8,763
  9,670
  10,620
  11,612
  12,646
  13,722
  14,842
  16,006
  17,217

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  82
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  737
  1,049
  1,620
  2,423
  3,515
  4,959
  6,818
  9,152
  12,017
  15,463
  19,531
  24,253
  29,652
  35,740
  42,524
  50,001
  58,163
  66,999
  76,494
  86,634
  97,402
  108,785
  120,771
  133,351
  146,519
  160,273
  174,614
  189,550
  205,090
  221,248
  238,042
Adjusted assets (=assets-cash), $m
  655
  1,049
  1,620
  2,423
  3,515
  4,959
  6,818
  9,152
  12,017
  15,463
  19,531
  24,253
  29,652
  35,740
  42,524
  50,001
  58,163
  66,999
  76,494
  86,634
  97,402
  108,785
  120,771
  133,351
  146,519
  160,273
  174,614
  189,550
  205,090
  221,248
  238,042
Revenue / Adjusted assets
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
  0.412
Average production assets, $m
  89
  143
  220
  329
  478
  674
  927
  1,244
  1,634
  2,102
  2,655
  3,297
  4,031
  4,859
  5,782
  6,798
  7,908
  9,109
  10,400
  11,779
  13,243
  14,790
  16,420
  18,130
  19,921
  21,791
  23,741
  25,771
  27,884
  30,081
  32,364
Working capital, $m
  177
  168
  260
  388
  563
  795
  1,093
  1,467
  1,926
  2,478
  3,130
  3,887
  4,752
  5,728
  6,815
  8,014
  9,322
  10,738
  12,260
  13,885
  15,610
  17,435
  19,356
  21,372
  23,482
  25,687
  27,985
  30,379
  32,869
  35,459
  38,151
Total debt, $m
  192
  335
  557
  868
  1,292
  1,852
  2,573
  3,479
  4,591
  5,928
  7,506
  9,338
  11,433
  13,795
  16,427
  19,328
  22,495
  25,924
  29,608
  33,542
  37,720
  42,137
  46,787
  51,668
  56,777
  62,114
  67,678
  73,474
  79,503
  85,772
  92,288
Total liabilities, $m
  263
  407
  629
  940
  1,364
  1,924
  2,645
  3,551
  4,663
  6,000
  7,578
  9,410
  11,505
  13,867
  16,499
  19,400
  22,567
  25,996
  29,680
  33,614
  37,792
  42,209
  46,859
  51,740
  56,849
  62,186
  67,750
  73,546
  79,575
  85,844
  92,360
Total equity, $m
  473
  642
  991
  1,483
  2,151
  3,035
  4,173
  5,601
  7,354
  9,463
  11,953
  14,843
  18,147
  21,873
  26,025
  30,600
  35,596
  41,003
  46,814
  53,020
  59,610
  66,576
  73,912
  81,611
  89,669
  98,087
  106,864
  116,005
  125,515
  135,404
  145,682
Total liabilities and equity, $m
  736
  1,049
  1,620
  2,423
  3,515
  4,959
  6,818
  9,152
  12,017
  15,463
  19,531
  24,253
  29,652
  35,740
  42,524
  50,000
  58,163
  66,999
  76,494
  86,634
  97,402
  108,785
  120,771
  133,351
  146,518
  160,273
  174,614
  189,551
  205,090
  221,248
  238,042
Debt-to-equity ratio
  0.406
  0.520
  0.560
  0.590
  0.600
  0.610
  0.620
  0.620
  0.620
  0.630
  0.630
  0.630
  0.630
  0.630
  0.630
  0.630
  0.630
  0.630
  0.630
  0.630
  0.630
  0.630
  0.630
  0.630
  0.630
  0.630
  0.630
  0.630
  0.630
  0.630
  0.630
Adjusted equity ratio
  0.597
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612
  0.612

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  20
  45
  87
  147
  228
  334
  471
  643
  854
  1,106
  1,404
  1,774
  2,167
  2,610
  3,103
  3,646
  4,238
  4,878
  5,565
  6,298
  7,076
  7,898
  8,763
  9,670
  10,620
  11,612
  12,646
  13,722
  14,842
  16,006
  17,217
Depreciation, amort., depletion, $m
  16
  41
  45
  50
  57
  66
  77
  92
  110
  132
  157
  153
  187
  225
  268
  315
  366
  422
  481
  545
  613
  685
  760
  839
  922
  1,009
  1,099
  1,193
  1,291
  1,393
  1,498
Funds from operations, $m
  32
  86
  132
  196
  284
  400
  549
  735
  964
  1,238
  1,561
  1,926
  2,354
  2,835
  3,371
  3,961
  4,604
  5,299
  6,046
  6,843
  7,689
  8,583
  9,523
  10,510
  11,542
  12,621
  13,745
  14,915
  16,133
  17,399
  18,715
Change in working capital, $m
  -5
  63
  92
  129
  175
  231
  298
  374
  459
  552
  652
  757
  865
  976
  1,087
  1,198
  1,308
  1,416
  1,522
  1,625
  1,726
  1,824
  1,921
  2,016
  2,110
  2,204
  2,299
  2,394
  2,491
  2,590
  2,692
Cash from operations, $m
  37
  80
  40
  68
  109
  168
  251
  361
  504
  686
  909
  1,169
  1,489
  1,859
  2,284
  2,762
  3,296
  3,883
  4,524
  5,218
  5,963
  6,758
  7,602
  8,494
  9,432
  10,416
  11,446
  12,522
  13,642
  14,809
  16,023
Maintenance CAPEX, $m
  0
  -4
  -7
  -10
  -15
  -22
  -31
  -43
  -58
  -76
  -97
  -123
  -153
  -187
  -225
  -268
  -315
  -366
  -422
  -481
  -545
  -613
  -685
  -760
  -839
  -922
  -1,009
  -1,099
  -1,193
  -1,291
  -1,393
New CAPEX, $m
  -8
  -54
  -78
  -109
  -149
  -196
  -253
  -317
  -390
  -469
  -553
  -642
  -734
  -828
  -922
  -1,017
  -1,110
  -1,201
  -1,291
  -1,379
  -1,464
  -1,548
  -1,630
  -1,710
  -1,790
  -1,870
  -1,950
  -2,031
  -2,113
  -2,197
  -2,283
Cash from investing activities, $m
  -318
  -58
  -85
  -119
  -164
  -218
  -284
  -360
  -448
  -545
  -650
  -765
  -887
  -1,015
  -1,147
  -1,285
  -1,425
  -1,567
  -1,713
  -1,860
  -2,009
  -2,161
  -2,315
  -2,470
  -2,629
  -2,792
  -2,959
  -3,130
  -3,306
  -3,488
  -3,676
Free cash flow, $m
  -281
  22
  -44
  -52
  -55
  -50
  -33
  1
  57
  141
  259
  405
  602
  845
  1,136
  1,478
  1,871
  2,316
  2,812
  3,358
  3,954
  4,597
  5,288
  6,023
  6,802
  7,624
  8,488
  9,392
  10,337
  11,322
  12,347
Issuance/(repayment) of debt, $m
  192
  153
  222
  311
  424
  560
  721
  906
  1,112
  1,337
  1,578
  1,832
  2,095
  2,362
  2,632
  2,901
  3,167
  3,428
  3,684
  3,934
  4,178
  4,417
  4,651
  4,881
  5,109
  5,337
  5,565
  5,795
  6,029
  6,269
  6,516
Issuance/(repurchase) of shares, $m
  0
  0
  172
  232
  300
  374
  449
  522
  584
  630
  653
  653
  607
  519
  383
  197
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  285
  153
  394
  543
  724
  934
  1,170
  1,428
  1,696
  1,967
  2,231
  2,485
  2,702
  2,881
  3,015
  3,098
  3,167
  3,428
  3,684
  3,934
  4,178
  4,417
  4,651
  4,881
  5,109
  5,337
  5,565
  5,795
  6,029
  6,269
  6,516
Total cash flow (excl. dividends), $m
  4
  175
  178
  260
  369
  510
  688
  906
  1,169
  1,478
  1,837
  2,237
  2,697
  3,207
  3,768
  4,379
  5,038
  5,744
  6,496
  7,292
  8,132
  9,014
  9,938
  10,904
  11,911
  12,961
  14,052
  15,187
  16,366
  17,591
  18,863
Retained Cash Flow (-), $m
  -123
  -241
  -350
  -491
  -669
  -884
  -1,138
  -1,428
  -1,753
  -2,109
  -2,490
  -2,890
  -3,304
  -3,726
  -4,152
  -4,576
  -4,995
  -5,408
  -5,811
  -6,205
  -6,590
  -6,966
  -7,335
  -7,699
  -8,059
  -8,417
  -8,777
  -9,141
  -9,510
  -9,889
  -10,278
Prev. year cash balance distribution, $m
 
  72
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
 
  6
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  43
  337
  685
  1,087
  1,542
  2,048
  2,603
  3,205
  3,853
  4,543
  5,275
  6,046
  6,856
  7,702
  8,586
Discount rate, %
 
  4.80
  5.04
  5.29
  5.56
  5.83
  6.13
  6.43
  6.75
  7.09
  7.45
  7.82
  8.21
  8.62
  9.05
  9.50
  9.98
  10.48
  11.00
  11.55
  12.13
  12.74
  13.37
  14.04
  14.74
  15.48
  16.25
  17.07
  17.92
  18.82
  19.76
PV of cash for distribution, $m
 
  6
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  9
  62
  105
  136
  156
  165
  165
  156
  142
  124
  105
  86
  68
  52
  38
Current shareholders' claim on cash, %
  100
  100.0
  92.8
  86.9
  82.1
  78.2
  75.0
  72.3
  70.2
  68.5
  67.2
  66.1
  65.4
  64.8
  64.5
  64.3
  64.3
  64.3
  64.3
  64.3
  64.3
  64.3
  64.3
  64.3
  64.3
  64.3
  64.3
  64.3
  64.3
  64.3
  64.3

Mercury Systems, Inc. provides secure processing subsystems for various critical defense and intelligence programs in the United States. The company’s products and solutions are deployed in approximately 300 programs with 25 defense prime contractors. Its principal programs include Aegis, Patriot, Surface Electronic Warfare Improvement Program, Gorgon Stare, Predator, F-35, and Reaper. The company also designs, markets, and licenses software and middleware environments under the MultiCore Plus name to accelerate development and execution of signal and image processing applications on a range of heterogeneous and multi-computing platforms. In addition, it offers hardware products, such as signal and image processing, multi-computer, and sensor interfaces, including embedded processing boards, switch fabric boards, high speed input/output boards, digital receiver boards, high-density memory modules, secure solid-state drives, secure GPS receiver modules, and chassis-based systems; radio frequency (RF) and microwave assemblies, such as tuners, converters, transceivers, and switch filters; and RF and microwave components, which include power amplifiers and limiters, switches, oscillators, and equalizers. The company was formerly known as Mercury Computer Systems, Inc. and changed its name to Mercury Systems, Inc. in November 2012. Mercury Systems, Inc. was founded in 1981 and is headquartered in Chelmsford, Massachusetts.

FINANCIAL RATIOS  of  Mercury Systems (MRCY)

Valuation Ratios
P/E Ratio 76.6
Price to Sales 5.7
Price to Book 3.2
Price to Tangible Book
Price to Cash Flow 41.4
Price to Free Cash Flow 52.8
Growth Rates
Sales Growth Rate 14.9%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 33.3%
Cap. Spend. - 3 Yr. Gr. Rate 14.9%
Financial Strength
Quick Ratio 8
Current Ratio 0
LT Debt to Equity 38.5%
Total Debt to Equity 40.6%
Interest Coverage 26
Management Effectiveness
Return On Assets 3.7%
Ret/ On Assets - 3 Yr. Avg. 1.1%
Return On Total Capital 3.9%
Ret/ On T. Cap. - 3 Yr. Avg. 1.2%
Return On Equity 4.9%
Return On Equity - 3 Yr. Avg. 1.5%
Asset Turnover 0.5
Profitability Ratios
Gross Margin 46.3%
Gross Margin - 3 Yr. Avg. 46.2%
EBITDA Margin 15.6%
EBITDA Margin - 3 Yr. Avg. 11.5%
Operating Margin 8.9%
Oper. Margin - 3 Yr. Avg. 4.5%
Pre-Tax Margin 9.3%
Pre-Tax Margin - 3 Yr. Avg. 4.8%
Net Profit Margin 7.4%
Net Profit Margin - 3 Yr. Avg. 2.1%
Effective Tax Rate 20%
Eff/ Tax Rate - 3 Yr. Avg. 26.5%
Payout Ratio 0%

MRCY stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the MRCY stock intrinsic value calculation we used $270 million for the last fiscal year's total revenue generated by Mercury Systems. The default revenue input number comes from 2016 income statement of Mercury Systems. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our MRCY stock valuation model: a) initial revenue growth rate of 60% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 4.8%, whose default value for MRCY is calculated based on our internal credit rating of Mercury Systems, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Mercury Systems.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of MRCY stock the variable cost ratio is equal to 85.6%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $15 million in the base year in the intrinsic value calculation for MRCY stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 3.5% for Mercury Systems.

Corporate tax rate of 27% is the nominal tax rate for Mercury Systems. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the MRCY stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for MRCY are equal to 33%.

Life of production assets of 21.6 years is the average useful life of capital assets used in Mercury Systems operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for MRCY is equal to 38.9%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $473 million for Mercury Systems - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 41.229 million for Mercury Systems is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Mercury Systems at the current share price and the inputted number of shares is $1.6 billion.


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COMPANY NEWS

▶ Mercury Systems makes third big acquisition in the past year   [Apr-04-17 05:15PM  American City Business Journals]
▶ After-hours buzz: PRTK, MRCY, NVCR   [Apr-03-17 05:55PM  CNBC]
▶ Mercury Systems Acquires Delta Microwave   [04:01PM  GlobeNewswire]
▶ Lockheed, Raytheon Outsourcing Should Help This Defense Firm   [Mar-20-17 04:36PM  Investor's Business Daily]
▶ Mercury Systems Launches Mission Computing Product Line   [Feb-23-17 04:15PM  GlobeNewswire]
▶ After hours buzz: YHOO, RMD, MRCY   [06:04PM  at CNBC]
▶ Baron Funds Comments on Mercury Systems   [Jan-20-17 04:19PM  Gurufocus]
▶ What Hedge Funds Think About Mercury Systems Inc (MRCY)?   [Dec-09-16 12:24PM  at Insider Monkey]
Stock chart of MRCY Financial statements of MRCY
Valuation of Stocks

The paper VALUATION OF STOCKS: The Quest for Intrinsic Value provides a detailed description of our valuation model and discloses the calculation algorithm.

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