Mercury (MRCY) Gets $56M Defense Contract for Data Servers
Mercury Systems MRCY was recently awarded a $56-million contract by a leading defense prime contractor. Per the terms of the deal, Mercury is required to provide rapid data processing servers for a radar application. The order was received during the company’s fourth-quarter of fiscal 2022 and is expected to be shipped over the next several quarters.
Equipped with Mercury’s rugged servers, the advanced radar system will be able to sort and analyze massive amounts of sensor data at the edge. This will provide rapid and reliable awareness and early warning for defense platforms, weapons systems and their crews.
The continued flow of orders highlights MRCY’s commitment to developing compelling advanced radio frequency conversion and digital signal processing technologies and making them more accessible to the defense industry.
Mercury is benefiting from modernization in radar, electronic warfare and C4I, which is providing it with new opportunities in weapon systems, space, avionics processing, mission computing and embedded rugged services. Its domain expertise in analog and digital integration has helped it build a solid business relationship with defense and aerospace prime contractors for a long time.
Mercury Systems Inc Price and Consensus
Mercury Systems Inc price-consensus-chart | Mercury Systems Inc Quote
In June, the company was chosen by Ball Corporation’s BALL wholly owned subsidiary, Ball Aerospace, to enhance the data recording and storage performance of a methane monitoring satellite, MethaneSAT.
Integrating Mercury's RH3440 3U VPX high-density solid-state data recorder, Ball Aerospace’s MethaneSAT spectrometer intends to enable the satellite to gather critical data to solve environmental sustainability issues.
One of the leading providers of sensor and safety-critical mission processing subsystems in the world, Mercury released a new family of high-performance, ultra-compact tuner modules to support the spectrum processing applications of customers in the same month. It also unveiled the first-ever Avionics Modular Mission Platform computer aligned with the sensor open systems architecture specification in May to enhance decision accuracy and response times for pilots.
Before that, in May, MRCY entered a multi-year agreement to collaborate with Lockheed Martin LMT to develop and manufacture new sensor processing technologies at its Geneva-based facility to address the mission-critical needs of the aerospace and defense industry.
Through the $40-million worth contract, Mercury and Lockheed Martin intend to deliver the world’s most advanced airborne defense systems to Switzerland and other countries. It is noteworthy that Mercury’s continued efforts and investments have resulted in the successful completion of deals and created about $800 million worth of potential C4I opportunities based on the estimated lifetime value of its top 30 programs.
Zacks Rank & Stock to Consider
Currently, Mercury, Ball and Lockheed Martin each carry a Zacks Rank #3 (Hold). Shares of MRCY and LMT have risen 12.9% and 16.4%, respectively, year to date (“YTD”). BALL stock has plunged 29.8% YTD.
A better-ranked stock worth considering from the broader technology sector is Broadcom AVGO, which currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Broadcom's third-quarter fiscal 2022 earnings has been revised upward by 9.9% to $9.62 per share over the past 60 days. For fiscal 2022, the Zacks Consensus Estimate for Broadcom's earnings has moved north by 10 cents to $37.06 per share in the past 30 days.
Broadcom's earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 2.2%. Shares of AVGO have plunged 27.7% YTD.
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