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Mayville Engineering Company Inc

Mayville Engineering Company Inc

MEC
$19.10USD↑+1.06%+0.20 today

MARKET CAP

487.1M

P/E (TTM)

—

FWD P/E

43.3x

DAY RANGE

$19 – $20

52W RANGE

$12
$39

AI Summary

Stalk
StalkMedium

MEC remains in a Stage 2 advancing trend with clear higher highs and lows, reinforced by the active Parabola pattern signaling strong acceleration and aggressive demand. Medium- and long-term biases stay bullish under the uptrend structure, but price is currently extended above the rising EMAs and showing extreme overbought readings. Execution should be deferred and waited for a pullback into the rising EMA zone to align timing. The primary risk is a swift distribution phase from overextension that could break the EMA support and delay further upside.

  • ↑Q2 sales rose 23.2% YoY to $163M, led by 173% data center growth
  • ↑Qualified opportunity pipeline exceeds $125M in high-margin projects
  • ↓Adjusted EBITDA margin fell to 8.1% from 10.3% YoY amid rising costs
Full analysis →

The case for & against

Bull & Bear analysis

Bullish

Mayville Engineering Company, Inc. (NYSE:MEC) is a growing player in the engineering and manufacturing sector of the Industrials market, specializing in integration and fabrication services. The company primarily serves critical markets including the data center, commercial vehicle, and critical power segments. Positioned to capitalize on robust demand in these high-potential markets, MEC is focused on expanding its operational capabilities to drive growth and profitability while navigating cyclical market fluctuations.

Bull says

  • ↑Q2 sales rose 23.2% YoY to $163M, led by 173% data center growth
  • ↑Qualified opportunity pipeline exceeds $125M in high-margin projects
  • ↑Plans $50M capex over two years to unlock up to $60M revenue
  • ↑Strong liquidity position funds expansion and maintains flexibility
  • ↑High earnings yield and strong momentum support valuation
  • ↑Robust demand for cloud and commercial vehicle infrastructure drives growth

Bear says

  • ↓Adjusted EBITDA margin fell to 8.1% from 10.3% YoY amid rising costs
  • ↓Net debt jumped to $134.7M from $71.8M, elevating leverage risk
  • ↓Tight labor market (2.3% unemployment) may delay capacity expansion
  • ↓New awards of ~$40M won’t boost near-term revenue materially
  • ↓High short interest and negative profitability factor weigh on sentiment
  • ↓Margin compression and rising costs pressure returns and cash flows

Investment themes with MEC

High Dividend Yield↑ +0.15%

Companies paying above-average dividends

AISP · SMR · NWL

Earnings Call · Q4 2023 · Mgmt. Guidance

Updated 03-05-2025neutral

Transcript signals

Bull points

  • Our fourth quarter performance was a solid finish to the year, one highlighted by continued organic revenue growth, substantial year-over-year margin expansion, improved profitability and the second consecutive quarter of record free cash flow generation.
  • During the fourth quarter, demand conditions were generally favorable primarily driven by new project launches in our powersports, commercial vehicle and other end markets.
  • Importantly, our operational and commercial self-help initiatives are continuing to deliver improved profitability and cash generation to improve the cost absorption, value-based pricing and enhanced working capital efficiency.

Bear points

  • our fourth quarter results were impacted by the UAW strikes that were resolved in November together with the ongoing ramp up of production at our Hazel Park facility. In combination, these factors impacted fourth quarter adjusted EBITDA by 2.9 million.
  • During the fourth quarter, commercial vehicle revenues decreased by 1% on a year-over-year basis primarily due to $5 million of estimated net sales impact of the UAW strikes.
  • our fourth quarter results do not represent our declining volumes we expect in 2024 due to final fulfillment of expiring projects at the end of 2023.
Read full transcript analysis ›