Vertically integrated manufacturing solutions provider Mayville Engineering Company NYSE:MEC announced better-than-expected revenue in Q2 CY2026, with sales up 23.2% year on year to $163 million. On top of that, next quarter’s revenue guidance ($165 million at the midpoint) was surprisingly good and 3.6% above what analysts were expecting. Its non-GAAP profit of $0.07 per share was significantly above analysts’ consensus estimates.
Mayville Engineering (MEC) Q2 CY2026 Highlights:
- Revenue: $163 million vs analyst estimates of $150.4 million (23.2% year-on-year growth, 8.4% beat)
- Adjusted EPS: $0.07 vs analyst estimates of -$0.05 (significant beat)
- Adjusted EBITDA: $13.17 million vs analyst estimates of $11.4 million (8.1% margin, 15.6% beat)
- The company lifted its revenue guidance for the full year to $635 million at the midpoint from $605 million, a 5% increase
- EBITDA guidance for the full year is $56 million at the midpoint, below analyst estimates of $56.41 million
- Operating Margin: 0.2%, in line with the same quarter last year
- Free Cash Flow was -$6.65 million, down from $12.53 million in the same quarter last year
- Market Capitalization: $694.2 million
Company Overview
Originally founded solely on tool and die manufacturing, Mayville Engineering Company NYSE:MEC specializes in metal fabrication, tube bending, and welding to be used in various industries.
Revenue Growth
A company’s long-term sales performance is one signal of its overall quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Unfortunately, Mayville Engineering’s 6.9% annualized revenue growth over the last five years was mediocre. This was below our standard for the industrials sector and is a tough starting point for our analysis.
Long-term growth is the most important, but within industrials, a half-decade historical view may miss new industry trends or demand cycles. Mayville Engineering’s performance shows it grew in the past but relinquished its gains over the last two years, as its revenue fell by 3.7% annually.
We can better understand the company’s revenue dynamics by analyzing its most important segments, Commercial Vehicle and Construction & Access, which are 31.2% and 14.2% of revenue. Over the last two years, Mayville Engineering’s Commercial Vehicle revenue (exhaust, engine components, fuel systems) averaged 15.4% year-on-year declines while its Construction & Access revenue (fenders, hoods, frames for heavy machinery) averaged 7.3% declines.
This quarter, Mayville Engineering reported robust year-on-year revenue growth of 23.2%, and its $163 million of revenue topped Wall Street estimates by 8.4%. Company management is currently guiding for a 14.3% year-on-year increase in sales next quarter.
Looking further ahead, sell-side analysts expect revenue to grow 11.5% over the next 12 months, an improvement versus the last two years. This projection is commendable and implies its newer products and services will spur better top-line performance.
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Operating Margin
Operating margin is a key measure of profitability. Think of it as net income - the bottom line - excluding the impact of taxes and interest on debt, which are less connected to business fundamentals.
Mayville Engineering was profitable over the last five years but held back by its large cost base. Its average operating margin of 2.3% was weak for an industrials business. This result isn’t too surprising given its low gross margin as a starting point.
Looking at the trend in its profitability, Mayville Engineering’s operating margin decreased by 1.7 percentage points over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability. Mayville Engineering’s performance was poor no matter how you look at it - it shows that costs were rising and it couldn’t pass them onto its customers.
In Q2, Mayville Engineering’s breakeven margin was 0.2%, in line with the same quarter last year. This indicates the company’s cost structure has recently been stable.
Earnings Per Share
We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.
Sadly for Mayville Engineering, its EPS declined by 17% annually over the last five years while its revenue grew by 6.9%. This tells us the company became less profitable on a per-share basis as it expanded.
Diving into the nuances of Mayville Engineering’s earnings can give us a better understanding of its performance. As we mentioned earlier, Mayville Engineering’s operating margin was flat this quarter but declined by 1.7 percentage points over the last five years. Its share count also grew by 9.1%, meaning the company not only became less efficient with its operating expenses but also diluted its shareholders.
Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.
For Mayville Engineering, its two-year annual EPS declines of 43.8% show it’s continued to underperform. These results were bad no matter how you slice the data.
In Q2, Mayville Engineering reported adjusted EPS of $0.07, down from $0.10 in the same quarter last year. Despite falling year on year, this print easily cleared analysts’ estimates. Over the next 12 months, Wall Street is optimistic. Analysts forecast Mayville Engineering’s full-year EPS will flip from negative $0.06 to positive $0.84.
Key Takeaways from Mayville Engineering’s Q2 Results
It was good to see Mayville Engineering beat analysts’ EPS expectations this quarter. We were also excited its EBITDA outperformed Wall Street’s estimates by a wide margin. On the other hand, its EBITDA guidance for next quarter missed and its full-year EBITDA guidance fell slightly short of Wall Street’s estimates. Zooming out, we think this was a mixed print. The market seemed to be hoping for more, and the stock traded down 5.3% to $26.28 immediately following the results.
Is Mayville Engineering an attractive investment opportunity right now? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. .