Raymond James described the earnings as a ‘beat and raise’ quarter and sees Mercury emerging as a key profitability story in the defense sector.
Mercury Systems Inc. (MRCY) has drawn a wave of bullish analyst sentiment after delivering a stronger-than-expected fourth-quarter (Q4) earnings, leading to several upward revisions in price targets and investment outlooks.
Raymond James upgraded the aerospace and defense tech firm to ‘Strong Buy’ from ‘Outperform’ and raised its price target to $80 from $55, as per TheFly. The research firm described the earnings as a ‘beat and raise’ quarter and sees Mercury emerging as a key profitability story in the defense sector.
Mercury Systems’ stock hit over three-year highs on an intraday basis and traded over 24% higher at the time of writing. On Stocktwits, retail sentiment toward the stock jumped to ‘bullish’ from ‘bearish’ territory the previous day. Message volume improved to ‘extremely high’ from ‘normal’ levels in 24 hours.
The brokerage projected the company could drive earnings before interest, taxes, depreciation, and amortization (EBITDA) margin expansion by up to 70% over the next two years, supported by an improving order backlog and strong revenue potential.
Baird also boosted its target on the stock to $70 from $58 while reiterating its ‘Outperform’ rating. After revising its model to reflect Q4 results, Baird suggested that Mercury’s turnaround is gaining pace and encouraged investors to maintain their positions in the stock.
Truist echoed the positive outlook, raising its price target to $71 from $60 and maintaining a ‘Buy’ rating. The research firm pointed to the enormous revenue beat, thanks to a $30 million revenue pull-forward, as a key driver.
It also noted a 70% jump in bookings on a quarter-on-quarter basis. However, the firm added that Mercury’s fiscal 2026 outlook appears conservative.
Mercury Systems’ stock has gained over 58% year-to-date and over 96% in the last 12 months.
For updates and corrections, email newsroom[at]stocktwits[dot]com.<