[12-12-11] While Comtech\u2019s<\/b> 2012 fiscal first-quarter revenue intake of $113 million easily beat Wall Street\u2019s consensus of $94 million, analysts are raising a flag of caution at the company\u2019s quarterly earnings, which fell 51 percent year-over-year.
\n According to its latest financial results issued Dec. 9, Comtech admitted that a $12.5 million merger-termination fee it received during the period could not offset the impact of decreased sales on profits. Most of Comtech\u2019s upside, however, was derived from a temporary blip in the U.S. military\u2019s MTS\/BFT programs, which are currently winding down.
\nThe company saw modest core revenue growth of 6.4 percent, reflecting healthy 15.6 percent gains in its Telecom segment. Those gains were partially offset by a 6.4 percent decline in its EF Mobile Data and a 7.5 percent drop in its RF Amplifier business.
\n While Comtech affirmed its full-year revenue guidance and boosted its midpoint
\nEPS forecast, Raymond James<\/b> Analyst Chris Quilty said that a warning from Comtech\u2019s management that full-year revenues could decline due to weakening orders, adverse global business conditions, increasing U.S. government budget pressures, and related spending delays, provided a shaky outlook for the company in the near-term.
\n \u201cComtech posted decent first-quarter results, and we were pleasantly surprised by the strong revenue and margin performance in the all-important Telecom segment,\u201d Quilty said in a report to Satellite TODAY Insider<\/i>. \u201cThat said, Comtech is facing another year of headwinds in the Mobile Data business, and management has clearly grown more cautious with regard to the company\u2019s growth outlook. We are inclined to believe the stock will trade down on first-quarter results and guidance, but the stock\u2019s attractive valuation and an aggressive buyback program should limit any downside.\u201d
\n In September, Comtech received notice from a group of financiers led by MMI Investments that it has nominated two candidates to the company\u2019s six-member board of directors. In that notice, the firm also criticized Comtech\u2019s strategy to kickstart growth through acquisitions. \u201cReturning its cash to shareholders through a special dividend or sharply increased buybacks would be a better use of its capital,\u201d MMI said.
\n The investor group withdrew its nominations in November.<\/p>\n","protected":false},"excerpt":{"rendered":"
[12-12-11] While Comtech\u2019s 2012 fiscal first-quarter revenue intake of $113 million easily beat Wall Street\u2019s consensus of $94 million, analysts are raising a flag of caution at the company\u2019s quarterly earnings, which fell 51 percent year-over-year. According to its latest financial results issued Dec. 9, Comtech admitted that a $12.5 million merger-termination fee it […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":"","_links_to":"","_links_to_target":""},"categories":[2],"tags":[],"class_list":["post-83856","post","type-post","status-publish","format-standard","hentry","category-news"],"acf":[],"_links":{"self":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/posts\/83856"}],"collection":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/comments?post=83856"}],"version-history":[{"count":0,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/posts\/83856\/revisions"}],"wp:attachment":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/media?parent=83856"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/categories?post=83856"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/tags?post=83856"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}