Redwire Corp (NYSE: RDW)

Sector: Industrials Industry: Aerospace & Defense CIK: 0001819810
Market Cap 674.51 Mn
P/B 0.73
P/E -2.52
P/S 2.28
ROIC (Qtr) -20.72
Div Yield % 0.00
Rev 1y % (Qtr) 50.69
Total Debt (Qtr) 228.85 Mn
Debt/Equity (Qtr) 0.25
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About

Redwire Corp, often recognized by its stock symbol RDW, is a prominent player in the space solutions industry. The company specializes in mission-critical space infrastructure, combining decades of flight heritage with an innovative culture to create new technologies for government and commercial customers. Redwire's primary business activities revolve around providing mission-critical solutions based on core space infrastructure offerings. These offerings encompass avionics and sensors, power generation, structures and mechanisms, radio frequency...

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Investment thesis

Bull case

  • Healthy cash reserves of 54.33M provide 4.08x coverage of short-term debt 13.30M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of (146M) fully covers other non-current liabilities (11.80M) by 12.38x, showing strong long-term stability.
  • Robust tangible asset base of 293M provides 4.80x coverage of working capital 61.06M, indicating strong operational backing.
  • Cash reserves of 54.33M exceed inventory value of 53.49M by 1.02x, indicating strong liquidity and inventory management.
  • Cash position of 54.33M represents healthy 0.89x of working capital 61.06M, demonstrating strong operational liquidity.

Bear case

  • Operating cash flow of (146M) barely covers its investment activities of (173.37M), with a coverage ratio of 0.84, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (173.37M) provide weak support for R&D spending of 11.67M, which is -14.85x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Cash reserves of 54.33M provide limited coverage of acquisition spending of (151.88M), which is -0.36x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Operating cash flow of (146M) provides insufficient coverage of deferred revenue obligations of 60.01M, which is -2.43x, raising concerns about future service delivery capabilities.
  • The company's operating cash flow of (146M) shows concerning coverage of stock compensation expenses of 50.87M, with a -2.87 ratio indicating potential earnings quality issues.

Peer comparison

Companies in the Aerospace & Defense
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 GE General Electric Co 347.18 Bn 39.89 7.57 20.49 Bn
2 RTX RTX Corp 272.90 Bn 40.54 3.08 39.51 Bn
3 BA Boeing Co 185.24 Bn 98.01 2.07 54.10 Bn
4 LMT Lockheed Martin Corp 151.16 Bn 30.13 2.01 21.70 Bn
5 NOC Northrop Grumman Corp /De/ 100.62 Bn 24.06 2.40 17.02 Bn
6 HWM Howmet Aerospace Inc. 99.61 Bn -156.86 7.95 3.05 Bn
7 GD General Dynamics Corp 94.33 Bn 27.82 2.39 8.01 Bn
8 TDG TransDigm Group INC 75.70 Bn 41.87 8.31 30.05 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.57 2.53
EV to Cash from Ops. EV/CFO -5.67 74.76
EV to Debt EV to Debt 3.62 70.01
EV to EBIT EV/EBIT -4.18 8.56
EV to EBITDA EV/EBITDA -4.74 28.68
EV to Free Cash Flow [EV/FCF] EV/FCF -5.19 73.68
EV to Market Cap EV to Market Cap 1.23 1.05
EV to Revenue EV/Rev 2.80 9.46
Price to Book Value [P/B] P/B 0.73 7.10
Price to Earnings [P/E] P/E -2.52 21.32
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) -4.48 -3.71
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 18.88
Dividend per Basic Share Div per Share (Qtr) 0.00 0.72
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 11.28
Interest Coverage Int. cover (Qtr) -5.28 -10.55
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -121.15 -77.00
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 26.07 27,757.82
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 1.15
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -304.90 -9.06
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -443.27 11.61
EBIT Growth (1y) % EBIT 1y % (Qtr) -354.74 -0.09
EBT Growth (1y) % EBT 1y % (Qtr) -321.91 -31.50
EPS Growth (1y) % EPS 1y % (Qtr) -162.81 -100.94
FCF Growth (1y) % FCF 1y % (Qtr) -972.70 26.50
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -77.43 -1.44
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.20 0.51
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.03
Cash Ratio Cash Ratio (Qtr) 0.36 1.78
Current Ratio Curr Ratio (Qtr) 1.41 3.60
Debt to Equity Ratio Debt/Equity (Qtr) 0.25 0.32
Interest Cover Ratio Int Coverage (Qtr) -5.28 -10.55
Times Interest Earned Times Interest Earned (Qtr) -5.28 -10.55
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) -59.00 -309.23
EBIT Margin % EBIT Margin % (Qtr) -66.95 -340.98
EBT Margin % EBT Margin % (Qtr) -79.64 -345.99
Gross Margin % Gross Margin % (Qtr) 3.90 -51.92
Net Profit Margin % Net Margin % (Qtr) -90.50 -347.41