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V2X (VVX) Valuation After Securing Its Largest 10-Year, $425 Million U.S. Air Force F-16 Contract

Simply Wall St · 2d ago

V2X (VVX) just landed its largest F 16 cockpit display contract yet: a 10 year, $425 million deal with the U.S. Air Force that deepens its role in long term defense modernization.

See our latest analysis for V2X.

That backdrop helps explain why, despite a recent 1 month share price return of negative 5.8 percent, V2X still shows a solid year to date share price return of 15.6 percent and a robust 3 year total shareholder return of 40 percent. This suggests momentum is consolidating rather than stalling as the market reassesses its long term contract pipeline.

If this Air Force win has you rethinking your defense exposure, it could be a good moment to explore other opportunities across aerospace and defense stocks for similar long runway contract stories.

Yet with shares still trading at a sizable discount to analyst targets and intrinsic value, investors face a key question: is V2X quietly undervalued, or is the market already pricing in this contract driven growth?

Most Popular Narrative Narrative: 18.1% Undervalued

Compared with the last close at $55.02, the most widely followed narrative points to a meaningfully higher fair value anchored in multi year earnings growth.

Continued realization of operational synergies and efficiencies post merger, disciplined cost management, and strong free cash flow generation (supported by low capex and improving leverage) gives management financial flexibility for debt reduction, shareholder returns (e.g. $100M buyback), and targeted growth investments, all of which are expected to drive accelerated earnings per share growth.

Read the complete narrative.

Curious how modest revenue growth assumptions can still fuel rapid earnings expansion and a richer future earnings multiple than today? Want to see the full playbook behind that, including the margin reset, the projected step up in profitability, and the terminal valuation the narrative is quietly baking in? Read on to see which numbers really move the fair value line.

Result: Fair Value of $67.18 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, that earnings runway could narrow if large contract awards are delayed or protested, or if fixed price programs stumble during early execution.

Find out about the key risks to this V2X narrative.

Build Your Own V2X Narrative

If you see the story differently or want to test your own assumptions against the numbers, you can build a custom view in just minutes: Do it your way.

A great starting point for your V2X research is our analysis highlighting 5 key rewards and 1 important warning sign that could impact your investment decision.

Ready for your next investment move?

Do not stop with a single contract story when you can scan the wider market for overlooked opportunities that match your goals with precision and speed.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.