Mercury's Contract Winning Spree Continues, Secures $9M Deal

Mercury Systems, Inc. (NASDAQ:MRCY) recently received an initial $9 million design contract for advanced and safe flight controllers.

The 10-year contract with an international aerospace company has an estimated lifetime value of $40 million. The contractual work will be executed through fiscal 2020.

Mercury’s BuiltSAFE architecture will be used to design the processing elements and build the high level flight safety certification for platform missions within civilian airspace.

Orders & Accolades Keep Driving Efforts

Mercury bagged a string of deals of significant value in the last reported quarter. These include a $5 million order for rugged, embedded processing subsystems for shipboard radar processing and a $20.5 million follow-on order to provide integrated subsystems to the U.S. Navy.

Recently the company received a $6.7 million follow-on order for its high-performance subsystems for a naval electronic warfare (EW) application.

In total, the company bagged around 12 orders including follow-on orders in the fiscal first quarter. Notably, during the quarter, it was included in Fortune magazine's 2018 100 Fastest-Growing Companies list.

Mercury has been focusing on the EW segment with new innovations and products. It recently launched the EnsembleSeries DCM6111 6U VPX digital transceiver, which incorporates BuiltSECURE technology and is based on the OpenVPX standard. It is suitable for advanced electronic warfare applications operating in high threat areas.

Recently, the company also secured a $9.2 million follow-on order from a defense prime contractor for custom-designed radiation-tolerant SSDs, a $6.7 million follow-on order for BuiltSECURE and a $3.6 million order to incorporate high-performance RF microelectronics into a naval radar system.

Moreover, Mercury is also significantly investing in embedded computing technology, which is reflected in its recent release of board-to-board data transmission rates of 100 Gigabits per second.

Furthermore, Mercury, through acquisitions and organic expansion, has broadened its exposure to the C4I market, which encompasses avionics, command and control, and dedicated communications. The acquisitions of Thermis and Germane last year were along this line.

Zacks Rank & Stocks to Consider

Mercury currently has a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader Computer and Technology sector are Synopsys, Inc. (NASDAQ:SNPS) , eGain (NASDAQ:EGAN) and Marvell Technology Group Ltd. (NASDAQ:MRVL) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth rate for Synopsys, eGain and Marvell is projected to be 10%, 30% and 9.38%, respectively.

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