V2X, Inc. (NYSE: VVX)

Sector: Industrials Industry: Aerospace & Defense CIK: 0001601548
Market Cap 1.98 Bn
P/B 1.83
P/E 24.72
P/S 0.45
ROIC (Qtr) 6.61
Div Yield % 0.00
Rev 1y % (Qtr) 7.90
Total Debt (Qtr) 1.14 Bn
Debt/Equity (Qtr) 1.05

About

V2X, Inc., previously known as Vectrus, Inc., operates in the defense industry, providing critical mission solutions to clients in 322 locations across 51 countries and territories worldwide. The company's extensive global presence and capability to deliver full lifecycle converged solutions enable it to support the success of its clients' missions efficiently and accurately. V2X's primary business activities encompass Aerospace Solutions, Technology Solutions, Operations and Logistics, and Training Solutions. Aerospace Solutions provide the necessary...

Read more

Price action

Investment thesis

Bull case

  • Healthy cash reserves of 182.32M provide 12.21x coverage of short-term debt 14.94M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of 195.65M provides strong 16.02x coverage of stock compensation 12.22M, indicating sustainable incentive practices.
  • Robust free cash flow of 184.90M exceeds capital expenditure of 10.75M by 17.21x, indicating strong organic growth funding capability.
  • Operating cash flow of 195.65M fully covers other non-current liabilities 61.43M by 3.19x, showing strong long-term stability.
  • Robust tangible asset base of 1.24B provides 6.72x coverage of working capital 184.36M, indicating strong operational backing.

Bear case

  • Operating cash flow of 195.65M barely covers its investment activities of (35.90M), with a coverage ratio of -5.45, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Cash reserves of 182.32M provide limited coverage of acquisition spending of (25.15M), which is -7.25x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Operating earnings of 183.21M show weak coverage of depreciation charges of 111.98M, with a 1.64 ratio indicating high capital intensity and potential reinvestment needs.
  • Free cash flow of 184.90M represents just -9.67x of debt issuance (19.11M), suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • High depreciation of 111.98M relative to operating cash flow of 195.65M, which is 0.57x suggests significant maintenance capital requirements affecting free cash flow.

Customer Breakdown of Revenue (2024)

Geographical Breakdown of Revenue (2024)

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 342.94 Bn 42.54 7.80 20.84 Bn
2 RTX RTX Corp 252.05 Bn 38.24 2.93 40.71 Bn
3 BA Boeing Co 174.43 Bn -17.16 2.16 53.35 Bn
4 LMT Lockheed Martin Corp 126.61 Bn 30.15 1.73 22.19 Bn
5 GD General Dynamics Corp 95.62 Bn 22.69 1.86 8.01 Bn
6 NOC Northrop Grumman Corp /De/ 89.30 Bn 22.22 2.18 16.96 Bn
7 HWM Howmet Aerospace Inc. 88.16 Bn 60.80 11.05 3.19 Bn
8 TDG TransDigm Group INC 80.97 Bn 43.39 9.17 30.02 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.92 3.58
EV to Cash from Ops. EV/CFO 14.96 58.38
EV to Debt EV to Debt 2.57 98.04
EV to EBIT EV/EBIT 15.98 19.42
EV to EBITDA EV/EBITDA 9.55 33.60
EV to Free Cash Flow [EV/FCF] EV/FCF 15.83 91.66
EV to Market Cap EV to Market Cap 1.48 1.13
EV to Revenue EV/Rev 0.66 11.27
Price to Book Value [P/B] P/B 1.83 4.81
Price to Earnings [P/E] P/E 24.72 31.79
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 -3.75
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 22.95
Dividend per Basic Share Div per Share (Qtr) 0.00 0.70
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 14.15
Interest Coverage Int. cover (Qtr) 2.16 -18.00
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 43.92 -50.32
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 204.59 1,609.43
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 0.75
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 151.30 -30.98
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 17.11 10.65
EBIT Growth (1y) % EBIT 1y % (Qtr) 38.26 -26.90
EBT Growth (1y) % EBT 1y % (Qtr) 381.39 -27.25
EPS Growth (1y) % EPS 1y % (Qtr) 775.86 -99.21
FCF Growth (1y) % FCF 1y % (Qtr) 185.64 6.61
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 12.67 -5.55
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.39 0.51
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.07
Cash Ratio Cash Ratio (Qtr) 0.20 1.76
Current Ratio Curr Ratio (Qtr) 1.20 3.72
Debt to Equity Ratio Debt/Equity (Qtr) 1.05 0.07
Interest Cover Ratio Int Coverage (Qtr) 2.16 -18.00
Times Interest Earned Times Interest Earned (Qtr) 2.16 -18.00
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 6.70 -345.84
EBIT Margin % EBIT Margin % (Qtr) 4.15 -382.63
EBT Margin % EBT Margin % (Qtr) 2.23 -387.93
Gross Margin % Gross Margin % (Qtr) 8.50 -33.31
Net Profit Margin % Net Margin % (Qtr) 1.80 -389.13