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V2X (VVX)
NYSE:VVX
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V2X
(NYSE:VVX)
70Outperform
Positive Factors
Earnings
V2X reported adjusted EPS well above expectations due to record topline performance, improved operations, and lower interest expenses.
Sales Growth
Record sales and profitability indicate heightened demand, especially in the Indo-Pacific region, contributing to V2X's strong position.
Negative Factors
Profitability Outlook
The 2025 outlook suggests topline growth at the midpoint but lower EBITDA margins, indicating some caution in future profitability.
V2X (VVX) vs. S&P 500 (SPY)
Market Cap
$1.51B
Dividend YieldN/A
Average Volume (3M)245.22K
Price to Earnings (P/E)43.7
Beta (1Y)1.13
Revenue Growth9.06%
EPS GrowthN/A
CountryUS
Employees16,000
SectorIndustrials
Sector Strength69
IndustryAerospace & Defense
Share Statistics
EPS (TTM)1.09
Shares Outstanding31,568,333
10 Day Avg. Volume283,466
30 Day Avg. Volume245,218
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.35
Price to Cash Flow (P/CF)1.70
P/FCF Ratio1.70
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$66.43Price Target Upside37.03% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
V2X Business Overview & Revenue Model
Company DescriptionV2X (VVX) is a leading company in the vehicle-to-everything communication sector, focusing on developing and providing innovative solutions that enable vehicles to communicate with their surroundings. These solutions are crucial for enhancing traffic efficiency, safety, and enabling autonomous driving technologies. The company offers a range of products and services that facilitate seamless connectivity between vehicles and infrastructure, other vehicles, pedestrians, and networks.
How the Company Makes MoneyV2X generates revenue primarily through the sale of its communication systems and software to automotive manufacturers, infrastructure developers, and government agencies. The company also earns income from licensing its proprietary technology and software solutions to third-party developers and partners. Additionally, V2X may engage in strategic partnerships and collaborations with other technology firms and industries to expand its market reach and develop integrated solutions, which can also contribute to its revenue streams.
V2X Financial Statement Overview
Summary
V2X demonstrates strong revenue growth and improved profitability in the last year, supported by a healthier balance sheet with reduced leverage. The company's robust cash flow generation further strengthens its financial position. However, profitability margins could be improved further. The overall financial health is strong, with significant improvements in key areas.Income Statement
V2X shows a positive revenue growth rate from $3.96B to $4.32B (9.06% annual growth). The gross profit margin improved slightly from 8.45% to 7.93%, while the net profit margin turned positive from -0.57% to 0.80%. EBIT margin increased from 3.14% to 3.68%. However, the EBITDA margin decreased from 5.98% to 3.68%. These figures reflect a strong revenue growth but reveal some pressure on profitability margins.75
Positive
Balance Sheet
The company's debt-to-equity ratio significantly improved from 1.18 to 0.05, indicating a stronger equity position relative to debt. Return on Equity (ROE) improved from -2.28% to 3.38%, suggesting better utilization of equity. The equity ratio slightly increased from 32.14% to 31.78%. The improvement in leverage and ROE showcases financial stability, though the equity ratio still indicates moderate leverage.70
Positive
Cash Flow
Free cash flow grew from $162.95M to $254.24M (55.96% growth), reflecting strong cash generation. The operating cash flow to net income ratio improved significantly, highlighting better cash conversion efficiency from operations. The free cash flow to net income ratio remains robust, supporting the company's ability to generate cash relative to earnings. Overall, cash flow metrics indicate a healthy cash position with strong growth.80
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 4.32B | 3.96B | 2.89B | 1.78B | 1.40B | Gross Profit |
| 342.96M | 334.86M | 295.01M | 160.42M | 124.15M | EBIT |
| 159.20M | 124.42M | 55.77M | 62.02M | 43.48M | EBITDA |
| 262.88M | 237.25M | 118.05M | 62.02M | 43.48M | Net Income Common Stockholders |
| 34.68M | -22.57M | -14.33M | 45.73M | 36.95M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 268.32M | 72.65M | 116.07M | 38.51M | 66.95M | Total Assets |
| 3.23B | 3.08B | 3.23B | 889.46M | 843.81M | Total Debt |
| 53.81M | 1.16B | 1.33B | 151.16M | 197.57M | Net Debt |
| -214.51M | 1.09B | 1.22B | 112.65M | 130.62M | Total Liabilities |
| 2.20B | 2.09B | 2.24B | 539.37M | 538.87M | Stockholders Equity |
| 1.03B | 990.80M | 997.08M | 350.09M | 304.94M |
| Cash Flow | Free Cash Flow | |||
| 254.24M | 162.95M | 81.07M | 51.56M | 59.58M | Operating Cash Flow |
| 254.24M | 187.97M | 93.50M | 61.34M | 64.08M | Investing Cash Flow |
| -28.65M | -22.65M | 175.96M | -12.64M | -138.03M | Financing Cash Flow |
| -24.50M | -211.02M | -193.24M | -75.58M | 105.77M |
V2X Technical Analysis
Positive
48.48
Price Trends
48.61
Negative
54.40
Negative
52.59
Negative
Market Momentum
-0.68
Negative
51.17
Neutral
59.03
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VVX, the sentiment is Positive. The current price of 48.48 is above the 20-day moving average (MA) of 46.02, below the 50-day MA of 48.61, and below the 200-day MA of 52.59, indicating a neutral trend. The MACD of -0.68 indicates Negative momentum. The RSI at 51.17 is Neutral, neither overbought nor oversold. The STOCH value of 59.03 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for VVX.
V2X Risk Analysis
V2X disclosed 51 risk factors in its most recent earnings report. V2X reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
V2X Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $8.23B | 17.21 | 13.79% | ― | 14.04% | 29.08% | |
75 Outperform | $13.94B | 16.79 | 75.34% | 1.89% | 14.07% | 116.33% | |
73 Outperform | $6.78B | 18.57 | 26.45% | 1.16% | 11.30% | ― | |
70 Outperform | $1.51B | 43.73 | 3.44% | ― | 9.06% | ― | |
69 Neutral | $17.19B | 14.90 | 29.12% | 1.15% | 7.93% | 541.97% | |
68 Neutral | $5.19B | 18.81 | 17.62% | 1.39% | -3.87% | -37.31% | |
62 Neutral | $8.16B | 12.81 | 0.47% | 3.07% | 3.83% | -16.36% |
* Industrials Sector Average
Performance Comparison
VVX
V2X
48.48
3.76
8.41%
BAH
Booz Allen
111.55
-32.40
-22.51%
CACI
Caci International
370.02
-3.97
-1.06%
KBR
KBR
50.65
-10.04
-16.54%
SAIC
Science Applications
104.65
-37.19
-26.22%
LDOS
Leidos Holdings
133.60
6.89
5.44%
V2X Earnings Call Summary
Earnings Call Date: Feb 24, 2025 | % Change Since: 15.29% | Next Earnings Date: May 13, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong financial performance in 2024, with record revenues and contract wins, along with significant debt reduction. The company demonstrated substantial growth in the Indo-Pacific region and secured a strong backlog for future growth. However, there were concerns about the completion of key programs and potential defense budget cuts. Overall, the sentiment is positive, with significant achievements outweighing the challenges.Highlights
Record Quarterly Revenue and Growth
Fourth-quarter revenue increased by 11% year-over-year to $1.16 billion. Full-year revenue grew by 9% to $4.3 billion, exceeding the top end of guidance.
Indo-Pacific Region Growth
The Indo-Pacific region saw a 27% increase in revenue, highlighting significant growth and alignment with national security priorities.
Debt Reduction and Cash Generation
Net debt improved by $210 million year-over-year, achieving a net leverage ratio of 2.6 times, providing significant flexibility for 2025.
Record Contract Wins
Secured over $5.5 billion in contract wins in 2024, setting a new record for the company and building a strong foundation for future growth.
Strong Backlog
Total backlog at the end of the year was $12.5 billion, representing a 1.2 times book-to-bill ratio in the quarter.
Growth in Warfighter Training Readiness Solutions
The $3.7 billion Warfighter-Training Readiness Solutions program is ramping up, supporting national security readiness.
Lowlights
KC-10 and T1A Program Completion
The completion of these programs, which contributed approximately $80 million to revenue in 2024 with mature margins, presents a headwind for 2025.
Potential Budget Cuts and Uncertainty
Discussion of potential 8% budget cuts in defense spending could impact future contracts and growth, though specifics remain uncertain.
Company Guidance
In the V2X Fourth Quarter 2024 Earnings Conference Call, the company reported notable financial metrics and strategic accomplishments. V2X achieved record quarterly revenue of $1.16 billion, marking an 11% year-over-year increase, and full-year revenue growth of 9% to $4.3 billion, surpassing the top end of their guidance. Adjusted EBITDA for the fourth quarter was $86.2 million, with a full year total of $310 million, showing 5% and 6% growth respectively. The company reported a remarkable improvement in net debt by $210 million year-over-year, resulting in a net leverage ratio of 2.6 times. Additionally, V2X secured contract wins worth over $5.5 billion, contributing to a total backlog of $12.5 billion, which is 1.2 times book-to-bill ratio for the quarter. The company also highlighted the potential for growth in the Indo-Pacific region, with a 27% revenue increase, and emphasized its strategic alignment with national security priorities. Looking forward to 2025, V2X anticipates revenue growth between $4.375 billion and $4.5 billion, with adjusted EBITDA projected at $305 million to $320 million.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.