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Verdict
Quantitative factor alignment verified for current market regime.
Quant Score
Rank
#1122
Positioning
Market Dominance
Manufacturing
Aircraft
$1.4B
Stephen G. Oswald
Ducommun Incorporated provides engineering and manufacturing products and services primarily to the aerospace and defense, industrial, medical, and other industries in the United States. It operates through two segments, Electronic Systems and Structural Systems. The Structural System segment designs, engineers, and manufactures contoured aluminum, titanium, and Inconel aero structure components.
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| Stock | Rating | Score▼ | Quality | Value | Momentum | P/E | EV/EBITDA | ROE | ROA | Gross Mgn | Op Mgn | Net Mgn | Rev Growth | Div Yield | D/E | Mkt Cap | AUDIT |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
$UL UNILEVER PLC | 78 | 96 | 98 | 59 | - | - | 28.5% | 8.0% | 100.0% | 100.0% | 10.4% | -4.6% | 3.3% | 0.0x | $141.8B | VS | |
$ASML ASML HOLDING NV | 77 | 89 | 86 | 83 | - | - | 46.1% | 16.6% | 51.3% | 31.9% | 26.8% | -4.0% | 1.0% | 25.0x | $272.1B | VS | |
$ESLT ELBIT SYSTEMS LTD | 76 | 81 | 87 | 85 | - | - | 10.3% | 3.1% | 24.1% | 7.2% | 4.7% | 14.3% | 0.8% | 25.0x | $11.4B | VS | |
$MT ArcelorMittal | 75 | 71 | 98 | 85 | - | - | 2.2% | 1.5% | 9.3% | 5.3% | 2.2% | -8.5% | 2.2% | 16.0x | $18.9B | VS | |
$AMAT APPLIED MATERIALS INC /DE | 75 | 85 | 87 | 84 | 20.9x | 13.6x | 35.5% | 19.8% | 48.7% | 29.2% | 24.7% | 4.4% | 0.8% | 32.0x | $181.9B | VS | |
$SIMO Silicon Motion Technology CORP | 75 | 84 | 86 | 85 | - | - | 11.8% | 8.8% | 45.9% | 11.3% | 11.1% | 25.7% | 3.7% | 0.0x | $1.8B | VS | |
$CODA Coda Octopus Group, Inc. | 74 | 83 | 90 | 79 | 16.3x | 11.9x | 7.6% | 7.0% | 66.5% | 17.1% | 15.6% | 39.0% | 0.0% | 0.0x | $115M | VS | |
$GSK GSK plc | 74 | 84 | 90 | 70 | - | - | 22.6% | 4.9% | 71.2% | 12.8% | 9.4% | 1.7% | 5.9% | 124.0x | $72.1B | VS | |
$EFXT Enerflex Ltd. | 74 | 80 | 91 | 83 | - | - | 3.0% | 1.1% | 20.9% | 7.3% | 1.3% | 3.0% | 0.9% | 67.0x | $1.2B | VS | |
$BUD Anheuser-Busch InBev SA/NV | 74 | 84 | 97 | 63 | - | - | 8.2% | 3.5% | 55.3% | 25.9% | 12.4% | 0.7% | 1.7% | 0.0x | $87.0B | VS | |
$DCO DUCOMMUN INC /DE/ | 56 | 41 | 41 | 77 | - | 783.2x | -4.8% | -2.5% | 26.5% | -3.3% | -3.4% | 7.9% | 0.0% | 33.0x | $1.4B | ||
| SECTOR BENCH | - | - | - | - | - | 22.3x | 11.5x | -2.5% | -0.1% | 42.5% | 1.3% | -0.2% | 5.9% | 0.0% | 0.2x | - | REF |
DUCOMMUN INC /DE/ (DCO) receives a "Hold" rating with a composite score of 56.2/100. It ranks #1122 out of 7,333 stocks in our coverage universe and carries a 3-star rating. Ratings are driven by a 6-factor quantitative model measuring quality, value, momentum, investment, stability, and short interest.
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YOY expansion rate
Core pricing power
Operating efficiency
Bottom-line conversion
Equity capital efficiency
Asset base utilization
Financial leverage load
Direct cash return
Stephen G. Oswald
Chief Executive Officer
Labor Force
2,460
41
29
84
Audit Verdict: Average governance indicators based on financial metrics.
No recent insider transactions available for DCO
Outperforming peers — winners tend to keep winning over 3-12 months
Fair valuation relative to peers
Average quality profile
Low volatility — smoother ride and historically better risk-adjusted returns
Aggressive spending — empire-building risk, dilutive growth
Mid-range overall rating
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Relative valuation derived from Manufacturing sector benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Re-calculated daily.
No analyst ratings for DCO.
View All RatingsMaterial decline in asset turnover efficiency detected
High margin volatility — erratic forensic earnings quality
| Factor | Global | Sector | Tilt |
|---|---|---|---|
| PROFITABILITY | 41 | 18 | +23ALPHA |
| MOMENTUM | 77 | 79 | -2NEUTRAL |
| VALUATION | 41 | 19 | +22ALPHA |
| INVESTMENT | 29 | 31 | -2NEUTRAL |
| STABILITY | 84 | 87 | -3NEUTRAL |
| SHORT INT | 55 | 61 | -6DRAG |
Global = full universe. Sector = relative to industry peers. Positive tilt indicates idiosyncratic strength.
ROIC -38.5% vs WACC 9.2% (spread -47.7%)
GM 26% vs sector 43%, OM -3% vs sector 1%
Capital turnover 1.30x
Rev growth 8%, 10yr history
Interest coverage N/A
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation and elite competitive moats.
Profit generated per dollar of shareholder equity
Efficiency of asset utilization
Pricing power and cost efficiency
Core business profitability
Bottom-line profitability
The Quality factor evaluates the persistence and magnitude of realized cash flows. Companies with scores >70 exhibit superior pricing power and structural financial resilience through diverse economic regimes.
Our uncertainty rating tracks the predictability of future cash flows and potential for permanent capital loss. Moderate visibility with standard industry cyclicality.
Our model assigns DUCOMMUN INC /DE/ a Hold rating, with a composite score of 56.2/100 and 3 out of 5 stars. Ranked #1122 of 7,333 stocks, DCO presents a mixed quantitative picture — neither compelling enough to initiate new positions nor weak enough to warrant selling. Investors already holding may consider maintaining their position while monitoring for changes in the factor profile.
DCO's quality score of 41/100 is below average, suggesting challenges with profitability or capital efficiency. The company reports a return on equity of -4.8% (sector avg: -2.5%), gross margins of 26.5% (sector avg: 42.5%), net margins of -3.4% (sector avg: -0.2%). Investors should examine whether management is actively addressing these weaknesses or if they reflect structural industry headwinds.
With a value score of 41/100, DCO appears somewhat expensive relative to its fundamentals. Key valuation metrics include an EV/EBITDA of 783.24x, a P/B ratio of 2.91x. Investors paying a premium here are likely betting on above-average growth or margin expansion to justify current prices.
DUCOMMUN INC /DE/'s investment score of 29/100 suggests limited reinvestment activity. Key growth metrics include revenue growth of 7.9% vs. a sector average of 5.9% and a return on assets of -2.5% (sector: -0.1%). While this can be positive for mature, cash-generative businesses returning capital to shareholders, it may also signal a lack of growth opportunities or management conservatism.
DCO shows strong momentum characteristics with a score of 77/100. The stock has been trending above key moving averages, indicating solid demand from institutional buyers. Revenue growth stands at 7.9% year-over-year, while a beta of 0.83 reflects its sensitivity to broader market moves. This level of momentum typically signals sustained investor confidence and favorable near-term price action.
DCO shows good financial stability with a score of 84/100. Key stability metrics include a beta of 0.83 and a debt-to-equity ratio of 33.00x (sector avg: 0.2x). This suggests manageable leverage and moderate price volatility, making it appropriate for investors seeking a balance between growth potential and capital preservation.
The short interest score of 55/100 for DCO suggests somewhat elevated bearish positioning by institutional traders. Specific risk factors include elevated leverage (D/E: 33.00x), small-cap liquidity risk. With a $1.4B market cap (small-cap), DUCOMMUN INC /DE/ may experience above-average volatility. Investors should consider whether the short thesis has merit or if it creates a potential short-squeeze opportunity.
DUCOMMUN INC /DE/ is a small-cap company in the Manufacturing sector, ranked #0 of 50 in its sector (100th percentile) and #1122 of 7,333 overall (85th percentile). Key comparisons include ROE of -4.8% trailing the -2.5% sector median and operating margins of -3.3% below the 1.3% sector average. This top-quartile standing reflects exceptional competitive strength relative to Manufacturing peers.
While DCO currently exhibits a HOLD profile, superior opportunities exist within the MANUFACTURING sector. Our model identifies several "Strong Buy" candidates with higher quality scores and more attractive valuations among direct industry competitors.
View Top Manufacturing Alpha →Quant Factor Profile
Key factor gap
Stability (84) vs Investment (29) — closing this gap could shift the rating.
EV/EBITDA 6735% ABOVE SECTOR MEDIAN
ROE 94% ABOVE SECTOR MEDIAN (FAVORABLE)
Gross Margin 38% BELOW SECTOR MEDIAN
AUDIT DATA AS OF SEP 27, 2025 (Q2 FY2025)
We rate DUCOMMUN INC /DE/ (DCO) as a Hold with a composite score of 56.2/100 at a current price of $125.67. The stock presents a mixed quantitative picture — neither compelling enough to warrant new accumulation nor weak enough to justify selling for existing holders. Our factors are split, and the overall profile suggests patience is warranted.
The rating is primarily driven by strength in stability (84th percentile) and momentum (77th percentile), which together account for the majority of the composite score. Offsetting weakness in investment (29th percentile) and value (41th percentile) tempers our overall conviction. We assign a No Moat rating (32/100), Medium uncertainty, and Poor capital allocation.
Key items to watch: the path to profitability. Any material change in these dynamics could warrant a reassessment of our rating. The moat trend is stable, which suggests the competitive landscape is stable for now.
DUCOMMUN INC /DE/ holds a top-quartile position (#0 of 50) within the Manufacturing sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 56.2/100 places it at rank #1122 in our full 7,333-stock universe. At $1.4B in market capitalization, DUCOMMUN INC /DE/ is a small-cap player in the Manufacturing space, which limits certain scale advantages but may allow for more agile strategic execution.
The outlook is moderately positive, with revenue expanding at 8% and favorable momentum (77th percentile) reflecting constructive market sentiment. The business shows steady execution, though the growth rate is below the levels typically associated with high-conviction growth stories. Momentum confirmation provides support for the current price level.
The margin cascade tells an important story: gross margins of 26% (-16.0pp vs sector) narrow to operating margins of -3% (-4.6pp vs sector) and net margins of -3.4%, yielding a gross-to-net conversion rate of -13%. The significant margin erosion from gross to net suggests elevated operating expenses, high interest costs, or other structural drags that warrant monitoring.
At a current price of $125.67, DUCOMMUN INC /DE/ is trading near fair value based on current fundamentals. Our value factor score of 41/100 reflects a composite assessment across multiple valuation metrics including price-to-earnings, price-to-book, EV/EBITDA, and price-to-sales ratios relative to both sector peers and the broader market. Valuation metrics are mixed, with no strong signal of mispricing in either direction.
The stock currently trades at EV/EBITDA of 783.2x (at a premium), P/B of 2.9x, P/S of 2.3x. We evaluate these multiples in the context of both absolute levels and sector-relative positioning to form our valuation view.
Positive momentum (77th percentile) indicates institutional accumulation and favorable technical dynamics that tend to persist in the intermediate term.
Thin net margins of -3.4% provide limited cushion against cost pressures, competitive pricing, or macroeconomic headwinds — even small changes in costs could swing the company to a loss.
We assign a Medium uncertainty rating to DUCOMMUN INC /DE/. The stock presents a balanced risk profile: current negative profitability (net margin -3.4%). While not risk-free, the core business fundamentals are adequate to withstand moderate economic stress, and the range of potential outcomes around our fair value estimate is manageable.
Specific risk factors that inform our assessment include: current negative profitability (net margin -3.4%). Each of these factors independently widens the distribution of potential outcomes, and in combination they create a risk profile that demands careful position sizing. The stability factor at the 84th percentile and quality factor at the 41th percentile provide a quantitative summary of the overall risk landscape.
Key risk mitigants include: above-average stability (84th percentile) suggests predictable business dynamics. These factors partially offset the identified risks and provide downside protection in adverse scenarios. On balance, the risk-reward profile is favorable for long-term investors.
We rate DUCOMMUN INC /DE/'s capital allocation as Poor. Key concerns include low returns on equity (-4.8%), negative profitability, weak asset returns (ROA -2.5%). Exemplary capital allocators generate ROE above 20% and maintain conservative leverage — DUCOMMUN INC /DE/ significantly underperforms these benchmarks, raising questions about management's ability to create shareholder value.
Investors should scrutinize management's reinvestment decisions and balance sheet trajectory before committing capital. Poor capital allocation often compounds over time: overlevered balance sheets limit strategic flexibility, while low returns on capital destroy shareholder value. We would need to see sustained improvement in profitability metrics and balance sheet discipline before considering an upgrade.
In summary, DUCOMMUN INC /DE/ receives a Hold rating with a composite score of 56.2/100 (rank #1122 of 7,333). Our quantitative framework assigns a No Moat (32/100, trend: stable), Medium uncertainty, and Poor capital allocation. The average factor score across quality, value, momentum, stability, and investment is 54/100.
Our analysis supports a neutral stance on DUCOMMUN INC /DE/. While the quantitative profile is not weak enough to warrant selling, it lacks the multi-factor strength required for a buy recommendation. Existing holders should maintain positions and monitor for catalysts — either fundamental improvement or valuation compression — that would shift the risk-reward balance.
Analysis derived from Blank Capital Research quantitative terminal. For informational purposes only. No trade solicitation. Past performance not indicative of future results. Consult a qualified advisor.
We do not assign DUCOMMUN INC /DE/ a meaningful economic moat, scoring 32/100 on our composite assessment. The ROIC-WACC spread of -47.7% is the primary signal of economic value creation. Current fundamentals do not demonstrate the kind of durable competitive advantages — such as superior returns on invested capital, margin superiority, or reinvestment efficiency — that would protect the company from competitive erosion over the long term. The highest-scoring pillar, growth durability, reached only 10.6/20.
The strongest moat sources are growth durability (10.6/20) and margin superiority (9.2/20). Rev growth 8%, 10yr history. GM 26% vs sector 43%, OM -3% vs sector 1%. These pillars form the core of DUCOMMUN INC /DE/'s competitive identity and are the primary drivers of excess returns in our framework.
Areas of relative weakness include economic value creation (0.1/20) and reinvestment efficiency (3.2/20). ROIC -38.5% vs WACC 9.2% (spread -47.7%). Improvement in these areas could meaningfully widen the moat over time, while deterioration would be an early warning of competitive erosion.
Our moat trend assessment is Stable. Multi-year ROIC and operating margin trajectories show neither meaningful improvement nor deterioration, suggesting the competitive position is steady. We expect DUCOMMUN INC /DE/'s moat profile to remain largely unchanged absent a material shift in return on capital or industry dynamics.
Key profit drivers include moderate revenue growth of 8%. The margin cascade from 26% gross to -3% operating to -3.4% net reveals the company's cost structure and reinvestment intensity. Our analysis indicates that profit quality is adequate though not exceptional, with the quality factor at the 41th percentile.
The margin profile shows gross margins of 26%, operating margins of -3%, net margins of -3.4%. Return metrics include ROE of -4.8% and ROA of -2.5%. Relative to the Manufacturing sector, gross margins are 16.0 percentage points below the sector median of 43%, and ROE of -4.8% compares to a sector median of -2.5%.
The balance sheet reflects moderate leverage with D/E of 33%, revenue growth of 8%. The sector median D/E is 0%, putting DUCOMMUN INC /DE/ at higher leverage than the typical peer. Overall balance sheet health is adequate for the current business environment.
Above 50MA
37.18%
Net New Highs
+51081
Meros Investment Management sold 259,973 shares of Interface in Q3, reducing its stake by $4.1 million, while the company reported strong quarterly results with 5.9% revenue growth and raised full-year guidance.
The U.S. aerospace industry is experiencing significant growth in 2025, with combined industry-wide sales nearly reaching $1 trillion. Three lesser-known companies with potential investment opportunities are EHang, Ducommun, and Eve Holding, each offering unique advantages and risks in the aerospace and urban mobility markets.
Recent performance snapshot Ducommun (DCO) has drawn fresh attention after recent share price moves, with the stock last closing at $119.25. That puts the company’s recent 1 year and multi year total returns firmly in focus for investors. See our latest analysis for Ducommun. Those recent gains fit into a stronger trend, with a 30 day share price return of 18.02% and a 1 year total shareholder return of 78.71% pointing to building momentum rather than a short lived bounce. If Ducommun’s move...
Context for Ducommun after recent stock performance Ducommun (DCO) has drawn attention after a strong run in its share price, with returns over the past month and past 3 months outpacing its recent daily moves and longer term performance. See our latest analysis for Ducommun. With the share price at $119.25 and a 30 day share price return of 18.02%, building on a 90 day gain of 33.18%, momentum contrasts with the longer term 1 year total shareholder return of 78.71% and 5 year total...