VSE Corporation
Orin's own judgment of how firmly the evidence points one way — not the chance the price goes up.
VSE Corporation's aviation aftermarket transformation is delivering genuine operational momentum — Q2 2026 revenue surged 65% YoY to $449.1M, the company has beaten consensus EPS estimates for eight straight quarters including an 87% surprise in the most recent report, and FY2025 produced the first positive free cash flow in five years at $5.7M alongside debt reduction from $485.2M to $342.8M.
The stock has corrected from its 52-week high near $247.85 to $167.44 as of 12 Oct, with RSI at 38.7 signaling approaching oversold conditions. However, at 60.9x trailing earnings — a 79% premium to the peer median of 34.0x — and with the CEO and CFO both selling shares in September 2026, the valuation premium and persistent insider dispositions still argue against adding despite the improved entry point.
What could go wrong
- Valuation compression. At 60.9x trailing PE versus a peer median of 34.0x and EV/EBITDA of 31.9x versus 18.5x, any deceleration in revenue growth or margin expansion could trigger a sharp multiple contraction.
- Insider selling. Over the trailing 24 months insiders have net sold 28,435 shares for $6.19M, with the CEO and CFO both disposing of shares in September 2026, signaling limited insider conviction at current levels.
- Integration risk from acquisitions. The August 2026 acquisition of Atech Turbine Components adds integration complexity on top of already rapid organic growth, and execution missteps could pressure the margin trajectory that underpins the premium valuation.
- Free cash flow fragility. FY2025 FCF of $5.7M (0.51% margin) is barely positive after four consecutive years of negative FCF, leaving little cushion if working capital needs resurface amid rapid revenue growth.
What would change my mind
Where this comes from: Q2 2026 results · earnings vs estimates · FY25 fundamentals · FY24 and FY25 fundamentals. Orin's read on VSEC; not advice.
How has the share price moved?
Down 17.3% over twelve months, from $179.52 on 27 Oct 2025 to $148.45 at the Tue 27 Oct 2026 close. Its highest close in that time was $243.48 on 17 Aug 2026; the last close is 39.0% below it.
- Green line: the closing price each trading day.
- Grey line: the average closing price over the last 50 trading days.
- Dashed amber line: the same over the last 200 trading days — a slower, smoother line.
- Bars along the bottom: shares traded each day — green when it closed higher than the day before, rose when lower (the most, 5.7M, on 20 Mar 2026).
- Flags: the company's filings, on the day they were made (a 10-Q is the quarterly report and a 10-K the annual report; an 8-K reports a major event).
On file
All VSEC filings| Form | Filed | What it says | Read |
|---|---|---|---|
| 13G/A | 14 Aug | — | on file |
| 13G/A | 14 Aug | — | on file |
| 8-K | 6 Aug | VSE Corporation declared a quarterly cash dividend of $0.10 per share, payable on October 29, 2026, to stockholders of record on October 15, 2026. | read |
| 10-Q | 6 Aug | VSE Corporation reported total revenues of $449.1 million for the three months ended June 30, 2026, a 65% increase year-over-year, and $773.7 million for the six months ended June… | read |
| 8-K | 5 Aug | VSE Corporation reported record second quarter 2026 revenue of $449.1 million, a 65.0% increase year-over-year, and GAAP Net Income of $28.5 million, up 109.1%. | read |
| 13G | 31 Jul | — | on file |
| 13G/A | 15 May | — | on file |
| 13G/A | 14 May | — | on file |
Largest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| BlackRock | $1.1B | 0.0% |
| State Street | $471.0M | 0.0% |
| Vanguard Capital Management | $283.8M | 0.0% |
| Vanguard Portfolio Management | $235.0M | 0.0% |
| Durable Capital Partners | $224.0M | 2.2% |
| Capital Research Global Investors | $189.5M | 0.0% |
| Geode Capital Management | $184.6M | 0.0% |
| Capital World Investors | $184.1M | 0.0% |
| Samlyn Capital | $147.9M | 2.4% |
| Invesco | $141.7M | 0.0% |
67 of the 815 filers we track · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 168 Form 4 filings; open-market trades net −$6.2M. Of the 50 on hand, 0 were open-market purchases and 13 sales — the rest are grants, option exercises and tax withholding.
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Start 3 free days →How is it priced, against its own past and its sector?
Priced at 40.6× its last 12 months of profit (Thu 5 Nov close) — higher than in 2 of its last 5 fiscal years (middle 55.6×); the typical Industrials company on the NASDAQ is at 18.4×.
| Measure | Now | Its usual | Sector |
|---|---|---|---|
| P/E | 40.6×below usual | 55.6× | 18.4× |
| P/S | 2.86×above usual | 1.06× | — |
| EV/EBITDA | 21.2×above usual | 19.6× | — |
| P/B | 1.7×near usual | 1.7× | — |
- "Its usual" is the middle of its own last 5 fiscal years.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
P/S: the company's total market value divided by one year of revenue. Used when there is no profit to measure.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
P/B: the share price divided by the book value per share — what the company owns minus what it owes, as its accounts record it. When book value is tiny, P/B swings wildly and says little.
What do the analysts who cover it publish?
The analysts' average 12-month price target is $261 (from $215 to $290) — 76% above the Tue 27 Oct close price. That is their published opinion, not Orin's.
$261
$215 – $290 · +76% against the last close
- 6 buy or overweight
- 1 hold
- 0 underweight or sell
Price target: the share price an analyst publishes for about 12 months ahead. It is the opinion of the firm that wrote it; the average is across the firms that cover the company.
Overweight / underweight: analysts' rating words: overweight means the firm expects the stock to do better than the others it covers, underweight worse. Their words, not Orin's.
How is it priced next to the companies it is compared to?
Priced at 40.6× its last 12 months of profit. Only 1 of the 1 companies it is compared to made a profit (TDG 34.3×), so there is no typical P/E.
| Company | Market value | P/E | EV/EBITDA | Gross margin | Net margin | ROE |
|---|---|---|---|---|---|---|
| VSECVSE Corporation | $5B | 40.6× | 21.2× | 15.6% | 7.3% | 5% |
| TDGTransDigm Group Incorporated | $62B | 34.3× | 18.4× | 59.6% | 21.3% | n/m |
- TDG: return on equity is not meaningful (n/m) — book value is below zero.
- The list of companies is the data vendor's choice, so it can include a company a person would not have picked.
Market value: the share price times the number of shares — what the whole company is priced at.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
Gross margin: the share of each $1 of sales left after the direct cost of making what was sold.
Net margin: the share of each $1 of sales kept as profit after every cost. Below zero, the company lost money.
ROE: return on equity: one year of profit as a share of the shareholders' money in the business (its book value).
Is it priced high or low compared with its own past?
Priced at 40.6× its last 12 months of profit (Thu 5 Nov close). It has no full fiscal year on file since its history starts, so there is nothing of its own to compare with.
- Now40.6×
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
Fiscal year (FY): the company's own 12-month accounting year, which need not match the calendar year.
How has its sector been priced?
Industrials companies on the NASDAQ were priced at a typical 18.4× their yearly profit (Tue 27 Oct close).
- Now18.4×
- Each year is the middle of that calendar year's daily sector P/E; "Now" is the Tue 27 Oct close figure, the same one in the table above.
Sector P/E: the middle P/E of the companies in the same sector on the same stock exchange, as the data vendor works it out each day.
What does a cash-flow model say a share is worth?
A standard cash-flow model puts it at $3 a share — 98% below the $147.87 price it was computed against (27 Oct).
| Model | Value a share | Against the price then |
|---|---|---|
| Standard | $3 | 98% below $147.87 |
- Levered: comes out below zero, so it is not shown.
Discounted cash flow: a model's estimate of what the company is worth today, from the cash it is forecast to make in future years. Small changes in the forecast move it a lot, and it says little about a company that loses money.
Standard / levered: two versions of the cash-flow model: the standard one counts the cash before the company pays its lenders, the levered one after.