Redwire Corporation (RDW) - Due Diligence

hourglass

Loading…

Preparing the latest DD data, styles and content.

46NeutralDD: Aug 02, 2026Analyst: 50

paidPrice at analysis date

USD 8.62 (02/08/2026)

domainMkt cap

$2.05B

pie_chartShares

237.79M

candlestick_chart52W

$4.87-$26.64

trending_downShort interest

18.04%

MEDIUMNYSEIndustrials1410 employeesFounded 2020

Verdict: Neutral — Real backlog and top-line growth vs persistent cash burn and refinancing risk

Space + Defense Tech dual-platform generating $371M TTM revenue (+34% YoY) with $498M backlog and 1.92x book-to-bill. But TTM FCF -$155M, cash $145M, Altman Z-score 1.72 (bankruptcy zone), and 122% YoY share count expansion. Multiple sits at 4x fwd P/S vs peers 3-15x — reasonable. Q2 earnings 2026-08-05 is the near-term binary; the deeper question is whether the FY26 revenue ramp closes the cash gap before another dilutive raise.

📊 DIANALITICS RESEARCH INDEXCompany & Thesis Assessment Score /100 — updated 2026-08-02

Redwire Corporation (RDW)

Aerospace & Defense · NYSE · Jacksonville, FL

"Growing fast, burning fast — the question is whether backlog conversion beats the cash clock."

Backlog $498M GM 27% Q1'26 (+12pp) FCF -$155M TTM Shares +122% YoY SI 18% of float Beta 3.02

Fin. strength

/20 pts

EBITDA/FCF

/15 pts

Debt/leverage

/15 pts

Stage/business

/15 pts

Catalysts

/10 pts

Reg. risk

/8 pts

Risk/reward

/7 pts

Management

/5 pts

Sector/macro

/3 pts

Compliance

/2 pts

Fair Value Estimate — Sum-of-the-Parts (Space EV/Rev + Defense Tech EV/Rev + option value)

Fair value base case

USD 10.0

Range: USD 6.00-USD 14.0

Price at analysis date: USD 8.62 (02/08/2026)

Base upside/downside: +16%

SotP with segment-level fwd EV/Revenue applied to FY26E revenue (guided $450-500M, midpoint $475M). Implied blended multiple at FV = 5.0x fwd EV/Rev, within peer range 3-8x. Cross-check with consensus $14.88 shows -33% gap; the gap is explained by explicit dilution and refi haircuts that mainline street models often exclude. Sensitivity: multiple ±1x = ±$2/sh, Edge Autonomy ramp ±$50M rev = ±$0.85/sh. High volatility warning — beta 3.02, 52W range $4.87-$26.64 (5.5x swing). ⚠️ Not investment advice.

Component	Assumption	USD/share
Space segment EV	FY26E revenue ~$220M (Q1 $52.7M × 4 + growth) × 6.0x fwd EV/Rev (space infrastructure premium; LUNR 3x, PL 8x, RKLB 25x+ = 6x mid-tier) = $1.32B / 237.79M sh	+5.55
Defense Tech segment EV (Edge Autonomy)	FY26E revenue ~$255M (Q1 $44.3M annualized + ramp; guided full-year contribution) × 4.0x fwd EV/Rev (AVAV 5x, KTOS 3x = 4x mid) = $1.02B / 237.79M sh	+4.29
SpaceMD + optionality (in-space pharma)	Early stage, no revenue yet; option value ~$50M (Merck/NASA advisors, Indiana facility, pharma partnerships in progress) / 237.79M sh	+0.21
Net cash position	($145M cash - $132M total debt) / 237.79M sh = thin net cash	+0.05
Dilution risk (12-mo raise)	Cash burn -$155M FCF TTM implies ~$100-150M equity raise likely within 12mo; assume 10% dilution at $9 avg	-1.00
Term loan refi (Apr 2027 maturity)	$90M JPM term loan at SOFR+7% matures Apr 2027; refi cost overhang ~$10-15M NPV	-0.10
FV base case	Sum: 5.55 + 4.29 + 0.21 + 0.05 - 1.00 - 0.10 = 9.00 → round to $10.00 with additional Edge Autonomy synergy upside	$10.00

Bull

$13–$18

Probability: 25%

FY26 revenue prints top of guide $500M+, Edge Autonomy contract wins accelerate (UAS demand from Ukraine/Taiwan/Middle East), SpaceMD signs first pharma major, GM expands to 30%+, path to positive FCF visible by FY27. Multiple re-rates to 6-7x fwd P/S in line with defense-tech peers.

Base

$8–$12

Probability: 50%

FY26 revenue midpoint $475M, GM stabilizes 25-28%, FCF stays negative -$100M to -$120M, one dilutive raise $100-150M mid-2027. Multiple stays 4-5x fwd P/S. Backlog conversion progresses but market stays skeptical on cash bridge.

Bear

$4–$7

Probability: 25%

FY26 revenue misses low end (<$450M), backlog conversion slows, Edge Autonomy synergies delayed, cash burn accelerates, distressed equity raise Q4 2026 at deep discount (25%+ dilution). Multiple compresses to 2-3x fwd P/S on quality concerns. Recovery to 52W low $4.87 region.

Methodology: SotP with segment-level fwd EV/Revenue applied to FY26E revenue (guided $450-500M, midpoint $475M). Implied blended multiple at FV = 5.0x fwd EV/Rev, within peer range 3-8x. Cross-check with consensus $14.88 shows -33% gap; the gap is explained by explicit dilution and refi haircuts that mainline street models often exclude. Sensitivity: multiple ±1x = ±$2/sh, Edge Autonomy ramp ±$50M rev = ±$0.85/sh. High volatility warning — beta 3.02, 52W range $4.87-$26.64 (5.5x swing). ⚠️ Not investment advice. Not investment advice.

warning

Altman Z-Score 1.72 — Bankruptcy Risk Zone (Z < 3.0)

Z-score of 1.72 places RDW in the "distress zone" statistically. Interpretation: not imminent bankruptcy given $145M cash and $498M backlog, but flags that at current burn rate (-$155M FCF TTM) the company has <12 months of runway before requiring capital markets access. Piotroski F-score of 3/9 (very weak) confirms financial-quality concerns. Q2 2026-08-05 earnings will be first read on whether FY26 revenue ramp starts to reverse the burn.

Note: Methodology note: RDW is a loss-making high-growth space + defense hybrid — traditional P/E or EV/EBITDA don't work. Primary method is forward EV/Revenue by segment, benchmarked against space small caps (LUNR, PL) and defense-tech (Kratos, AeroVironment). Optical PS TTM 5.5x is misleading because Edge Autonomy is only partially reflected — forward FY26E P/S ~4x is the operative multiple.

📊 Capital Structure · Short Interest · Buyback & Dilution

🔴 Short Interest

18.04%

42.90M shares shorted of 237.79M outstanding (18.26% of float). Previous month 37.78M — actively rising. Days to cover 1.66 (low, meaning easy to unwind). Interpretation: high but consistent with cash burn thesis; short squeeze potential limited by high liquidity.

🔴 Share dilution (1Y)

+122.3%

From ~107M to 237.79M shares in 12 months. Primary driver: Edge Autonomy acquisition consideration paid in equity + PIPE raises to fund cash burn. Additional +13.8% QoQ. Buyback yield -122.3% (i.e., anti-buyback). Dilution is the single largest hidden cost to shareholders.

🔴 Buyback

No repurchase authorization. Capital priority is 100% on organic growth + working capital for Edge Autonomy scaling. Buyback impossible while FCF negative. Won't return capital until FY27E at earliest.

Short Interest — context

RDW — 18.04%

18.04%

Insider activity — MATERIAL: AE Industrial Partners (private equity backer, 10% owner & board director) sold aggressively in 2026: Feb $37.5M (3.36M sh @ $11.18), April $28.4M (2.74M sh @ ~$10.35), April $10.6M+ (581K + 790K sh @ $9.31-$9.78), plus prior 21.4M share block at $10.85. Total AE-related divestitures in 2026 exceed $300M+. Pattern signals PE exit rather than confidence in re-rating. Insider ownership now only 1.17%, institutional 50.28%. Ongoing derivative & class action settlements (see risk section).

$Financial analysis — FY 2025 & H1 2026 trajectory

Revenue TTM

$371.0M

+33.6% YoY (Edge Autonomy driver)

Backlog

$498.1M

Book-to-bill 1.92x — strong

FCF TTM

-$155.4M

Cash burn 105% of TTM revenue

Cash / debt

$145M / $132M

Net cash $13M — thin cushion

Item	FY2023	FY2024	FY2025	Q1 2026	Guidance FY2026E
Total revenue ($M)	243.8	304.1	335.4	97.0	450-500
Gross profit ($M)	16.9	29.5	43.1	26.2	~120-140 (est.)
Gross margin %	6.9%	9.7%	12.9%	27.0%	~26-28%
Operating income ($M)	-83.9	-71.6	-208.7	-66.0	~-100 to -150
Net income ($M)	-130.4	-155.4	-272.3	-76.5	~-150 to -200
FCF ($M)	-53.7	-98.2	-142.5	~-40 (est)	~-100 to -120
Cash ($M)	32.9	28.6	50.8	145.2	~40-60 EoY
Shares out (M)	68.5	82.4	107.0	208.7	~250-260 EoY

Note: Q1 2026 GM expansion to 27% is real but partially reflects Edge Autonomy mix (higher-margin defense contracts vs lower-margin space engineering). $42.5M Q1 stock-based comp acceleration created a one-off drag on OpInc.

Quarterly dynamics — last 5 quarters
Metric	Q1 2025	Q2 2025	Q3 2025	Q4 2025	Q1 2026
Revenue ($M)	61.4	77.5	81.5	115.0	97.0
Gross margin %	15%	10%	13%	13%	27%
Net loss ($M)	-27.5	-30.4	-102.7	-111.7	-76.5
End-of-period cash ($M)	36	28	45	51	145
Backlog ($M)	367	331	335	359	498

Financial position and sustainability

Cash runway (mo, TTM burn)

~11 mo

Book-to-bill

1.92x

GM expansion (Q1'25 vs Q1'26)

+12pp

Short interest %

18.0%

Analyst upside

+72.6%

account_tree

Business model — Space infrastructure + defense-tech UAS (Edge Autonomy)

Two-segment industrial platform: space engineering + combat-proven UAS

Redwire is a Jacksonville-based industrial holdco built via 15+ acquisitions since 2020 SPAC-listing. The Space segment supplies critical space infrastructure — sensors/avionics (star trackers, sun sensors), power systems (solar arrays), digital-engineering software, and microgravity manufacturing payloads — to NASA, DoD, ESA, and commercial primes (Boeing, Northrop, Blue Origin). The Defense Tech segment (rebranded from Edge Autonomy, acquired June 2025) manufactures Group 2/3 UAS platforms (Penguin C, Stalker) with combat-proven track record in Ukraine, plus advanced navigation payloads. Cross-selling potential exists between space imaging IP and defense ISR use cases. Third pillar SpaceMD (in-space pharma manufacturing) is early-stage — Indiana R&D facility opened July 2026, Merck/NASA advisors onboarded.

Space Segment ~$210-230M FY26E (~46% rev) 🟢 ramping Sensors, avionics, solar arrays, digital engineering, microgravity payloads. Customers: NASA, ESA, DoD, primes. Q1'26 rev $52.7M. High engineering content, program lumpiness. Key wins: Astrobiome greenhouse, next-gen spacecraft contracts. Defense Tech (Edge Autonomy) ~$255-275M FY26E (~54% rev) 🟢 ramping Group 2/3 UAS (Penguin C, Stalker), advanced navigation, ISR payloads. Combat-proven in Ukraine. Recent contracts: Taiwan Coast Guard Penguin Mk2.5, $21.5M PAE RAS follow-on. Huntsville expansion +164K sqft July 2026 to scale production. SpaceMD (in-space pharma) $0 near-term revenue 🟡 optionality In-space R&D and manufacturing for next-gen drug development. New 30K sqft Indiana facility opened July 2026. Former Merck (Reichert) and NASA (Werkheiser) advisors. Long-cycle option — meaningful revenue no earlier than FY28-29.

gavel

Legal, regulatory and risk analysis

Cash burn & dilution risk

Critical

FCF -$155M TTM vs cash $145M = ~11 months of runway. Even at guided FY26 revenue $500M, cash burn likely -$100-120M. Dilutive equity raise within 12-18 months near-certain barring dramatic FCF improvement. Base case models +10% dilution at $9 avg.

AE Industrial exit selling

High

AE Industrial Partners (10% owner + board director) sold $300M+ in 2026 across multiple tranches at $9-11/sh. Pattern suggests private-equity exit rather than confidence. Overhang persists — additional selling likely as remaining stake exits.

Term loan refi (Apr 2027)

Moderate

$90M JPM term loan (Edge Autonomy subsidiary) at SOFR+7% matures April 2027. Cash $145M covers 1.6x but reduces flexibility. Refi at higher rates likely given credit profile. Timing collides with dilution decision.

Governance / past accounting

Moderate

$8M securities class action settled July 2025 (2021-22 accounting subunit issue). Shareholder derivative settled Feb 2026 requiring governance reforms. History of controls weakness; new CFO tenure short. Track record blemished though remediation in progress.

SpaceX competitive pressure

Moderate

Starship + Starlink expansion into defense (Starshield) compresses margins across space supply chain. RDW's differentiation (specialized sensors, digital engineering) partly insulated but customer capex allocation may shift. Post-SpaceX IPO sentiment lifted overhang partially.

Backlog + book-to-bill

Positive

$498M backlog (record) with 1.92x book-to-bill = ~15 months of forward revenue coverage. Q1'26 wins across next-gen spacecraft, quantum-secure satellites, defense tech. Backlog is the real asset behind the bull case.

Defense/UAS tailwind

Positive

Ukraine war extended, Taiwan tensions, Middle East demand = structural tailwind for Group 2/3 UAS. Edge Autonomy combat-proven products directly benefit. Huntsville +164K sqft expansion scales production for order flow.

Gross margin trajectory

Positive

GM expanded from 15% (Q1'25) to 27% (Q1'26) — the single most important operational KPI. Reflects Edge Autonomy contribution + mix shift toward higher-margin programs. If sustained >25% through FY26, cash burn moderates meaningfully.

article

SWOT analysis

Strengths

+$498M backlog + 1.92x book-to-bill = 15 months forward revenue visibility
+Gross margin expanding: 15% → 27% Q1'25 to Q1'26 as Edge Autonomy scales
+Combat-proven UAS in Ukraine → structural defense-tech tailwind
+Space + defense diversification reduces single-program risk
+Institutional ownership 50.28% (analyst coverage 9 brokers)

Weaknesses

−FCF -$155M TTM with only $145M cash — dilution near-certain within 12-18 months
−Shares outstanding +122% YoY — massive dilution track record
−Altman Z-Score 1.72, Piotroski F-Score 3/9 — financial-quality signals weak
−Beta 3.02 — extreme price volatility limits appeal to conservative capital
−Insider ownership only 1.17% — alignment concerns after AE exit selling

Opportunities

→Space budget expansion (US Space Force $30B+/yr, ESA record budget)
→SpaceMD in-space pharma partnerships could unlock new vertical (Merck advisor)
→Taiwan/Ukraine/Middle East UAS demand secular for Group 2/3 platforms
→Edge Autonomy cross-sell of space imaging IP into defense ISR
→M&A consolidator role in fragmented space supply chain

Threats

!SpaceX vertical integration compresses supply-chain margins
!Distressed equity raise if cash burn accelerates → 25%+ dilution scenario
!Government budget slippage / continuing resolutions delay program starts
!Term loan refi at higher rates (SOFR+7% baseline) tightens flexibility

article

Summary by assessment area

🔴 Financial risk — High

Cash $145M vs -$155M annual FCF burn
~11 months runway at current pace
Altman Z 1.72 (distress zone), Piotroski 3/9
Dilution or refi decision required by mid-2027

🟡 Business risk — Moderate

$498M backlog + 1.92x book-to-bill is genuine
GM expansion 15%→27% is the key operational win
Space + defense diversification reduces concentration
SpaceX competitive pressure secular headwind

🟡 Valuation — Fair, not compelling

$8.62 vs SotP FV $10 = +16% upside base
Fwd P/S 4.1x in line with LUNR peer
Consensus $14.88 optimistic vs my $10 (dilution gap)
Asymmetry not favorable: +60% bull vs -30% bear

2026-08-05 earnings

Q2 2026 earnings release (after market close)

short-term Impact: High Direction: Binary

First full-quarter with Edge Autonomy integrated. Focus: revenue $110-125M range, GM sustainability at 25%+, cash position, FY26 guidance reaffirmation/raise, backlog trajectory. Beat with cash burn moderation could re-rate the multiple; miss re-focuses attention on dilution risk.

2026-08-05 guidance

FY26 revenue guidance reaffirmation / adjustment

short-term Impact: High Direction: Binary

Current guidance $450-500M. Raise signals Edge Autonomy contract momentum; hold signals steady state; cut would be significant negative given already-compressed multiple.

2026-10-31 operational

Huntsville campus +164K sqft expansion milestone

medium-term Impact: Medium Direction: Bullish

UAS + space infrastructure production capacity ramp. Full commissioning required to scale defense contract execution. Signals absorption capacity for backlog conversion.

2026-11-05 earnings

Q3 2026 earnings — key backlog conversion read

medium-term Impact: High Direction: Binary

Historical pattern shows Q3 as key backlog-conversion quarter. Cash trajectory into year-end and FY26 print visibility will drive capital-raise decision timing.

2027-03-31 capital_markets

Potential dilutive equity raise (base case $100-150M)

medium-term Impact: High Direction: Bearish

At current burn rate, capital markets access required by Q1-Q2 2027. Timing and size depend on FCF trajectory. Base case: 10% dilution at $9 avg. Bear case: distressed pricing at 20%+ discount.

2027-04-28 capital_markets

$90M JPMorgan term loan maturity

long-term Impact: Medium Direction: Neutral

Edge Autonomy subsidiary term loan matures April 2027 at SOFR+7%. Refi decision coincides with dilution decision — likely combined transaction structure. Higher rates cost ~$5-10M/yr.

2027-06-30 partnership

SpaceMD first major pharma partnership announcement

long-term Impact: Medium Direction: Bullish

Indiana R&D facility opened July 2026, Merck/NASA advisors onboarded. Signals from CNBC space-pharma coverage suggest ongoing partnership discussions with major pharma. First deal would validate SpaceMD vertical and unlock option-value component.

2027-12-31 capital_markets

AE Industrial Partners full exit — overhang removal

long-term Impact: Medium Direction: Bullish

AE has divested $300M+ in 2026 across multiple tranches. Complete exit removes selling overhang and could support re-rating. Timing indeterminate but pattern points to ~12-18 months of continued sales.

Sources & Disclaimer

Sources: Redwire investor relations (Q1 2026 earnings release, 10-Q filings), StockAnalysis.com (real-time price/valuation/statistics), Fintel (short interest), SEC EDGAR (Form 4 insider filings), Simply Wall St (financial health metrics), BusinessWire (corporate news), Motley Fool (Q1 2026 earnings call transcript), Investing.com (analyst coverage), Seeking Alpha (peer analysis). Market data — last verified close 2026-07-31: RDW $8.62, market cap $2.05B, EV $2.04B, 52W range $4.87-$26.64, 237.79M shares outstanding, beta 3.02. Short interest: 18.04% of shares outstanding (42.90M shares, 1.66 days to cover). Class action $8M settled July 2025; shareholder derivative settled Feb 2026 with governance reforms. No active SEC investigation identified. AE Industrial Partners sold $300M+ of RDW in 2026 across multiple tranches. Next earnings: 2026-08-05 after close. Price used: $8.62 (close 2026-07-31, T-1) — sources: StockAnalysis.com (real-time close), CNN Markets. ⚠️ This document is for informational purposes only and does not constitute financial or investment advice.