Mercury Systems (MRCY) vs. Cubic (CUB) Head to Head Analysis

Mercury Systems (NASDAQ: MRCY) and Cubic (NYSE:CUB) are both industrials companies, but which is the superior stock? We will compare the two businesses based on the strength of their profitability, institutional ownership, earnings, risk, dividends, valuation and analyst recommendations.

Dividends

Cubic pays an annual dividend of $0.27 per share and has a dividend yield of 0.5%. Mercury Systems does not pay a dividend. Cubic pays out -65.9% of its earnings in the form of a dividend.

Earnings and Valuation

This table compares Mercury Systems and Cubic’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Mercury Systems $408.59 million 6.26 $24.87 million $0.86 61.62
Cubic $1.49 billion 1.09 -$11.20 million ($0.41) -144.76

Mercury Systems has higher earnings, but lower revenue than Cubic. Cubic is trading at a lower price-to-earnings ratio than Mercury Systems, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Mercury Systems and Cubic’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Mercury Systems 9.14% 6.51% 5.12%
Cubic -0.75% -1.66% -0.80%

Insider and Institutional Ownership

96.4% of Mercury Systems shares are owned by institutional investors. Comparatively, 90.6% of Cubic shares are owned by institutional investors. 3.5% of Mercury Systems shares are owned by company insiders. Comparatively, 7.9% of Cubic shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Volatility and Risk

Mercury Systems has a beta of 0.23, indicating that its stock price is 77% less volatile than the S&P 500. Comparatively, Cubic has a beta of 1.1, indicating that its stock price is 10% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations for Mercury Systems and Cubic, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Mercury Systems 0 2 5 0 2.71
Cubic 0 1 5 0 2.83

Mercury Systems currently has a consensus price target of $50.20, indicating a potential downside of 5.27%. Cubic has a consensus price target of $60.17, indicating a potential upside of 1.38%. Given Cubic’s stronger consensus rating and higher probable upside, analysts plainly believe Cubic is more favorable than Mercury Systems.

About Mercury Systems

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.

About Cubic

Cubic Corporation (Cubic) designs, integrates and operates systems, products and services that provide situational awareness for its customers in the transportation and defense industries. The Company operates in three business segments across the global transportation and defense markets, which include Cubic Transportation Systems (CTS), Cubic Global Defense (CGD) and Cubic Global Defense Services (CGD Services). The Company’s CTS segment is a systems integrator of payment and information technology and services for travel solutions. The Company’s CGD Systems is focused on two primary lines of business: training systems and secure communications (SC) products. The Company’s CGD Services segment is a provider of training, operations, intelligence, maintenance, technical and other support services to the United States government and its agencies and allied nations. It also provides cross-domain hardware solutions to address multi-level security challenges across common networks.

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