The 10-second takeaway
For the quarter ended Jan. 31 (Q2), Comtech Telecommunications beat expectations on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped significantly, and GAAP earnings per share dropped significantly.
Gross margins improved, operating margins shrank, and net margins dropped.
Comtech Telecommunications booked revenue of $99.1 million. The five analysts polled by S&P Capital IQ hoped for net sales of $92.8 million on the same basis. GAAP reported sales were 39% lower than the prior-year quarter's $162.8 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.27. The six earnings estimates compiled by S&P Capital IQ predicted $0.21 per share. GAAP EPS of $0.27 for Q2 were 48% lower than the prior-year quarter's $0.52 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 41.8%, 440 basis points better than the prior-year quarter. Operating margin was 10.7%, 480 basis points worse than the prior-year quarter. Net margin was 5.9%, 400 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $99.1 million. On the bottom line, the average EPS estimate is $0.27.
Next year's average estimate for revenue is $419.6 million. The average EPS estimate is $1.28.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 280 members rating the stock outperform and 14 members rating it underperform. Among 75 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 74 give Comtech Telecommunications a green thumbs-up, and one gives it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Comtech Telecommunications is hold, with an average price target of $31.33.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.