VSE (VSEC) AI Stock Analysis

• Market Cap: $4.11B
• Dividend Yield: 0.23%
• Average Volume (3M): 226.87K
• Price to Earnings (P/E): 135.5
• Beta (1Y): 1.24
• Revenue Growth: 9.22%
• EPS Growth: 65.05%
• Country: US
• Employees: 1,400
• Sector: Industrials
• Sector Strength: 72
• Industry: Aerospace & Defense
• EPS (TTM): 0.99
• Shares Outstanding: 23,392,242
• 10 Day Avg. Volume: 224,311
• 30 Day Avg. Volume: 226,872
• PEG Ratio: -0.81
• Price to Book (P/B): 1.72
• Price to Sales (P/S): 1.57
• P/FCF Ratio: -32.86
• Enterprise Value/Market Cap: 0.93
• Enterprise Value/Revenue: 3.46
• Enterprise Value/Gross Profit: 30.89
• Enterprise Value/Ebitda: 31.03
• 1Y Price Target: $201.17
• Price Target Upside: 14.43% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 8
• EPS Forecast (FY): 3.58
• Revenue Forecast (FY): $1.09B

• Rating: 67 Neutral
• Price Target: $181.00 ▲(2.96% Upside)

VSE's overall stock score is driven by strong financial performance and strategic growth initiatives highlighted in the earnings call and recent corporate events. However, technical indicators suggest bearish momentum, and the high P/E ratio indicates potential overvaluation, which tempers the overall score.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust market demand and effective strategic execution, enhancing VSE's competitive position in the industry.

Strategic Acquisitions

Strategic acquisitions like Aero 3 expand VSE's service offerings and market reach, potentially improving margins and long-term profitability.

Balance Sheet Strength

A strong balance sheet with improved leverage ratios enhances financial stability, providing flexibility for future growth and investments.

Negative Factors

Profitability Margins

Declining gross profit margins suggest potential cost management issues, which could impact long-term profitability if not addressed.

Cash Flow Alignment

Misalignment between cash flow and profitability indicates potential cash management challenges, affecting liquidity and investment capacity.

Leadership Change

Leadership changes, such as the resignation of the Chief Accounting Officer, can disrupt operations and strategic continuity, impacting business stability.

VSE Business Overview & Revenue Model

Company Description

VSE Corporation operates as a diversified aftermarket products and services company in the United States. The company operates through three segments: Aviation, Fleet, and Federal and Defense. The Aviation segment provides international parts supply and distribution, supply chain solutions, and component and engine accessory maintenance, repair, and overhaul (MRO) services. This segment serves commercial airlines, regional airlines, cargo transporters, MRO integrators and providers, aviation manufacturers, corporate and private aircraft owners, and fixed-base operators. The Fleet segment offers parts supply, inventory management, e-commerce fulfillment, logistics, and other services to assist aftermarket commercial and federal customers with their supply chain management. This segment also provides sale of vehicle parts and supply chain services to support client truck fleets, as well as sustainment solutions and managed inventory services to government and commercial truck fleets. The Federal and Defense segment offers aftermarket refurbishment and sustainment services to extend and maintain the life cycle of military vehicles, ships, and aircraft for the United States Department of Defense (DoD). This segment also provides foreign military sales services, engineering, logistics, maintenance, configuration management, prototyping, technology, and field support services to the DoD and other customers. In addition, this segment offers energy consulting services and IT solutions to various DoD, federal civilian agencies, and commercial clients. The company also provides vehicle and equipment maintenance and refurbishment, logistics, engineering support, energy services, and IT and health care IT solutions, as well as consulting services. VSE Corporation was incorporated in 1959 and is headquartered in Alexandria, Virginia.

How the Company Makes Money

VSE generates revenue through multiple streams, primarily by offering services in maintenance, repair, and overhaul (MRO) for military and commercial aircraft, as well as providing logistics and supply chain management services. The company earns income from government contracts, which often involve long-term agreements for support and maintenance of defense systems. Additionally, VSE benefits from partnerships with various defense and aerospace entities, which can enhance its service offerings and market reach. The company also generates revenue through the sale of parts and equipment related to its services, and by acquiring complementary businesses that add to its capabilities and customer base.

VSE Financial Statement Overview

Summary

VSE shows strong revenue growth and effective leverage management, but faces challenges with profitability margins and cash flow alignment with earnings. Improvements in cost management and shareholder returns are needed.

Income Statement

VSE's income statement shows a positive trajectory with a revenue growth rate of 7.69% in the TTM period, indicating strong sales performance. However, the gross profit margin has decreased over time, currently at 8.12%, which is below industry averages, suggesting potential cost management issues. The net profit margin is modest at 1.01%, reflecting limited profitability. Despite these challenges, the EBIT and EBITDA margins are relatively stable, indicating operational efficiency.

Balance Sheet

The balance sheet reflects a strong financial position with a low debt-to-equity ratio of 0.046 in the TTM period, showcasing effective leverage management. The equity ratio is healthy, indicating a solid asset base supported by equity. However, the return on equity has decreased to 1.14%, suggesting room for improvement in generating returns for shareholders.

Cash Flow

Cash flow analysis reveals significant improvement in free cash flow, with a growth rate of 102.35% in the TTM period. The operating cash flow to net income ratio is 0.24, indicating moderate cash generation relative to earnings. However, the free cash flow to net income ratio of 0.60 suggests that cash flow generation is not fully aligned with profitability, highlighting potential cash management challenges.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.11B	1.08B	860.49M	669.45M	750.85M	661.66M
Gross Profit	124.17M	108.20M	95.61M	57.24M	25.14M	57.88M
EBITDA	123.60M	110.18M	111.41M	78.21M	47.12M	38.06M
Net Income	26.58M	30.52M	39.13M	28.06M	7.97M	-5.17M
Balance Sheet
Total Assets	1.56B	1.73B	1.35B	999.79M	918.56M	780.08M
Cash, Cash Equivalents and Short-Term Investments	8.78M	29.03M	7.77M	305.00K	518.00K	378.00K
Total Debt	45.11M	485.21M	459.26M	308.64M	317.73M	277.92M
Total Liabilities	577.11M	746.43M	733.61M	550.26M	501.23M	423.76M
Stockholders Equity	983.34M	988.19M	616.73M	449.53M	417.33M	356.32M
Cash Flow
Free Cash Flow	26.95M	-51.74M	-40.49M	-3.16M	-28.12M	31.33M
Operating Cash Flow	44.72M	-31.04M	-21.83M	8.05M	-17.60M	35.76M
Investing Cash Flow	-99.58M	-263.67M	-235.69M	-2.38M	-61.63M	20.22M
Financing Cash Flow	55.74M	315.81M	264.97M	-5.71M	79.37M	-56.34M

VSE Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 175.80
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VSEC, the sentiment is Positive. The current price of 175.8 is above the 20-day moving average (MA) of 171.37, above the 50-day MA of 171.08, and above the 200-day MA of 145.89, indicating a bullish trend. The MACD of -0.67 indicates Negative momentum. The RSI at 55.10 is Neutral, neither overbought nor oversold. The STOCH value of 46.97 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for VSEC.

VSE Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VVX	73 Outperform	$1.69B	21.21	7.70%	―	5.10%	774.57%
AIR	72 Outperform	$3.27B	104.35	2.35%	―	17.59%	-56.15%
VSEC	67 Neutral	$4.11B	135.48	5.28%	0.23%	9.22%	65.05%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
DCO	58 Neutral	$1.41B	-40.33	-5.27%	―	3.16%	-213.56%
MRCY	57 Neutral	$4.19B	-123.71	-2.24%	―	8.63%	72.72%
SPR	51 Neutral	$4.23B	-1.63	―	―	-1.31%	-78.19%

VSE Corporate Events

VSE Declares Quarterly Dividend Amid Shareholder Focus

On November 19, 2025, VSE Corporation announced that its Board of Directors declared a quarterly cash dividend of $0.10 per share, approved on November 18, 2025. The dividend will be paid on January 29, 2026, to stockholders of record as of January 15, 2026. This decision reflects VSE’s ongoing commitment to providing value to its shareholders and may positively impact the company’s market positioning by reinforcing investor confidence.

VSE Finalizes Stock Offering with Underwriters

On October 27, 2025, VSE Corporation entered into an Underwriting Agreement with Jefferies LLC and Morgan Stanley & Co. LLC to issue and sell 2,352,941 shares of its common stock at $170.00 per share, with an option for underwriters to purchase an additional 352,941 shares. The underwriters exercised this option in full on October 28, 2025, and the offering is set to close on October 29, 2025. The company expects net proceeds of approximately $441.6 million, which will be used to fund the acquisition of GenNx/AeroRepair IntermediateCo Inc., support potential future acquisitions, and for general corporate purposes.

VSE Acquires GenNx/AeroRepair and Reports Q3 Growth

On October 27, 2025, VSE Corporation announced its acquisition of GenNx/AeroRepair IntermediateCo Inc., alongside reporting record third-quarter 2025 financial results. The company achieved a 38.9% increase in total revenues to $282.9 million, despite a decrease in GAAP net income by 58.9%. The adjusted EBITDA rose by 58.4%, and adjusted net income increased by 110.5%. VSE also announced several new and renewed program awards, including agreements with AMETEK, Eaton, Bridgestone, and a defense MRO expansion with V2X, Inc. The company raised its full-year revenue and adjusted EBITDA margin guidance, reflecting strong execution of strategic priorities and operational efficiencies.

VSE’s Chief Accounting Officer Resigns

On October 8, 2025, Tarang Sharma, Chief Accounting Officer of VSE Corporation, announced his resignation effective October 31, 2025, to pursue an opportunity outside the Aviation industry. He will continue to provide consulting and advisory services to VSE Corporation through March 2026, ensuring a smooth transition. His resignation is not due to any disagreements with the company’s operations, policies, practices, or financial reporting.