The 10-second takeaway
For the quarter ended April 30 (Q3), Comtech Telecommunications beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped significantly and GAAP earnings per share shrank significantly.
Margins shrank across the board.
Comtech Telecommunications chalked up revenue of $99.8 million. The five analysts polled by S&P Capital IQ looked for a top line of $97.6 million on the same basis. GAAP reported sales were 24% lower than the prior-year quarter's $131.1 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 $0.29. The seven earnings estimates compiled by S&P Capital IQ predicted $0.24 per share. GAAP EPS of $0.29 for Q3 were 38% lower than the prior-year quarter's $0.47 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%, 170 basis points worse than the prior-year quarter. Operating margin was 10.6%, 610 basis points worse than the prior-year quarter. Net margin was 6.1%, 480 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $111.3 million. On the bottom line, the average EPS estimate is $0.39.
Next year's average estimate for revenue is $420.7 million. The average EPS estimate is $1.37.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 278 members out of 291 rating the stock outperform, and 13 members rating it underperform. Among 66 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 64 give Comtech Telecommunications a green thumbs-up, and two give 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 $33.20.
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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.