Mercury Systems to Buy Avalex Technologies; Shares Jump

Mercury Systems, Inc. (MRCY) has inked a deal to acquire Florida-based Avalex Technologies Corporation, a provider of mission-critical avionics, including rugged displays, integrated communications management systems, digital video recorders and Read More... The post Mercury Systems to Buy Avalex Technologies; Shares Jump appeared first on TipRanks Financial Blog.

Mercury Systems to Buy Avalex Technologies; Shares Jump

Mercury Systems, Inc. (MRCY) has inked a deal to acquire Florida-based Avalex Technologies Corporation, a provider of mission-critical avionics, including rugged displays, integrated communications management systems, digital video recorders and warning systems. Following the news, shares of the company jumped 2.7% to close at $48.14 on Monday.

Mercury Systems provides secure mission-critical technologies across the aerospace and defense industries. Mercury’s shares have lost 38.8% over the past year. (See Mercury Systems stock charts on TipRanks)

As per the terms of the deal, the purchase consideration will be funded with cash in hand and MRCY’s existing revolving credit line. The financial terms of the deal have not been disclosed so far. The acquisition is expected to close during the second quarter of fiscal 2022, ending December 31, 2021, subject to certain closing conditions.

The acquisition is expected to be immediately accretive to MRCY’s adjusted earnings. Markedly, Avalex is expected to earn revenue of $40 million with adjusted EBITDA margins of around 25% for the twelve months ending December 31, 2022.

Commenting on the deal, the President and CEO of MRCY, Mark Aslett, said, “With deep expertise in integrated displays, digital video recorders, and communications management, their suite of innovative avionics solutions uniquely position the Company to address and enable the growing demand for digitally converged solutions in the C4I and platform/mission management markets.”

Aslett added that Avalex’s offerings are highly complementary to Mercury’s strategies.

Recently, Goldman Sachs analyst Noah Poponak downgraded the stock to Hold from Buy with a price target of $52, implying 8% upside potential to current levels.

Poponak believes that Mercury will underperform its guidance over the next 6-12 months and cautions about more downward revisions in the second half of the next year owing to program slippages.

Overall, the stock has a Hold consensus rating based on 1 Buy, 3 Holds and 1 Sell. The average Mercury Systems price target of $60.80 implies 26.3% upside potential to current levels.

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The post Mercury Systems to Buy Avalex Technologies; Shares Jump appeared first on TipRanks Financial Blog.

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Amazon to Offer Business Insurance in U.K. — Report

Business insurance broker Superscript has said that Amazon (AMZN) plans to offer insurance to small and medium-sized businesses in the U.K., according to a report by Reuters. The company will Read More... The post Amazon to Offer Business Insurance in U.K. — Report appeared first on TipRanks Financial Blog.

Amazon to Offer Business Insurance in U.K. — Report

Business insurance broker Superscript has said that Amazon (AMZN) plans to offer insurance to small and medium-sized businesses in the U.K., according to a report by Reuters. The company will be offering business insurance in the country for the first time.

Superscript will provide insurance covers like professional indemnity insurance, cyber insurance and contents insurance to members of Amazon's Business Prime program. A spokesperson of Superscript said that “major U.K. insurers” will underwrite these covers.

Furthermore, in a bid to attract businesses, the insurance covers will be offered at a 20% discount. (See Amazon stock chart on TipRanks)

The Country Manager for Amazon Business U.K. & Ireland, Molly Dobson, said, “As businesses come out of the pandemic and gradually resume normalcy, we want customers to have the best-in-class tools to run their business.”

The CEO of Superscript, Cameron Shearer, said, “The (insurance) industry needs to bridge the divide between insurers and customers by providing a quick, smooth buying process that is customer-centric.”

Amazon’s entry into the U.K. business insurance segment follows U.S. insurtech Next Insurance’s announcement in March that it is offering insurance cover to small businesses in the country via Amazon Business Prime.

Amazon already offers “buy now, pay later” services and warranty insurance in Britain.

On September 13, Bank of America (BAC) analyst Justin Post reiterated a Buy rating on the stock with a price target of $4,250 (24.8% upside potential).

The analyst said, “The ability for SMB merchants to capture direct Online sales, off of marketplaces, is a long-term potential threat to Amazon, so we expect Amazon to offer a feature-rich product with deep integration with Amazon’s marketplace, fulfillment, checkout, and payments processing capabilities (with a possible discount on payments processing).”

“We expect some entrenched resistance to Amazon services due to competitive concerns, but the opportunity is big and Amazon’s existing customer relationships provide a foundation to help build adoption,” Post added.

Overall, the stock has a Strong Buy consensus rating based on 31 unanimous Buys. The average Amazon price target of $4,214.47 implies 23.7% upside potential. Shares have gained nearly 10.7% over the past six months.

According to TipRanks’ Smart Score rating system, Amazon scores a “Perfect 10,” suggesting that the stock is likely to outperform market averages.

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The post Amazon to Offer Business Insurance in U.K. — Report appeared first on TipRanks Financial Blog.

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