Why MDA Space is worth more than you think

Beacon Securities analyst Russell Stanley says that the planned IPO of York Space Systems reinforces the valuation case for MDA Space (MDA Space Stock Quote, Chart, News, Analysts, Financials TSX:MDA), arguing that public-market pricing for comparable space and defence assets continues to imply substantial upside for MDA.

Late Friday (Jan. 16), York Space Systems announced plans to go public, filing for a NYSE listing under the ticker YSS with a proposed offering of 16-million shares at US$30–US$34 per share. The midpoint of the range implies an equity value of roughly US$4.5-billion, with pricing expected on January 28. Stanley noted that annualizing York’s year-to-date 2025 revenue to about US$375-million implies a 2025E sales multiple of roughly 12.7x, or close to 13x.

York describes itself as one of the few space and defence primes with vertically integrated hardware and software spanning the full space ecosystem. The company is majority owned by AE Industrial Partners, which would see its economic stake reduced to about 24% post-IPO while retaining voting control.

In his Jan. 19 report, Stanley said substantially all of York’s revenue and backlog are tied to the U.S. Department of Defense through the Space Development Agency, where York is the largest provider to the Proliferated Warfighter Space Architecture by number of spacecraft in orbit, contracts awarded, and contract types as of September 2025. York reported backlog of US$642-million and 107 spacecraft at September 30, down from prior-year levels, alongside Q1–Q3/25 revenue of US$281-million, a gross margin of 19% versus 9% a year earlier, and an adjusted EBITDA loss of US$7-million, sharply improved from a US$39-million loss year over year.

Stanley said applying York’s implied valuation multiple to Beacon’s fiscal 2025 sales estimate of $1.60-billion for MDA would suggest a per-share value north of $150, underscoring what he views as a disconnect between MDA’s current valuation and that of emerging U.S.-listed peers.

He said that York’s financial profile also highlights MDA’s relative maturity, noting that MDA is already EBITDA, EPS and free-cash-flow positive, while many peers are only expected to turn EBITDA positive this year or later.

Despite a roughly 15% rally on Friday, Stanley said MDA continues to trade at less than 13x his fiscal 2027 Adjusted EBITDA forecast, representing a discount of about 72% to the 44x–45x multiples assigned to its closest peers. He said those peer valuations would support an MDA price target in the $103–$105 range, with even higher implied values from more liquid comparables. Near-term catalysts include contract wins, potential M&A, MDA’s Q4 results expected in early March, and the possibility of a U.S. exchange listing.

Stanley forecasts Adjusted EBITDA of $316-million on revenue of $1.60-billion in fiscal 2025, rising to $347-million on $1.79-billion of revenue in fiscal 2026.

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