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Comtech (CMTL) - Outerbridge Seeks Strategic Alternatives

Tuesday, June 15, 2021

Comtech (CMTL)
Outerbridge Seeks Strategic Alternatives

Comtech Telecommunications Corp. engages in the design, development, production, and marketing of products, systems, and services for advanced communications solutions in the United States and internationally. It operates in three segments: Telecommunications Transmission, Mobile Data Communications, and RF Microwave Amplifiers. The Telecommunications Transmission segment provides satellite earth station equipment and systems, over-the-horizon microwave systems, and forward error correction technology, which are used in various commercial and government applications, including backhaul of wireless and cellular traffic, broadcasting (including HDTV), IP-based communications traffic, long distance telephony, and secure defense applications. The Mobile Data Communications segment provides mobile satellite transceivers, and computers and satellite earth station network gateways and associated installation, training, and maintenance services; supplies and operates satellite packet data networks, including arranging and providing satellite capacity; and offers microsatellites and related components. The RF Microwave Amplifiers segment designs, develops, manufactures, and markets satellite earth station traveling wave tube amplifiers (TWTA) and broadband amplifiers. Its amplifiers are used in broadcast and broadband satellite communication; defense applications, such as telecommunications systems and electronic warfare systems; and commercial applications comprising oncology treatment systems, as well as to amplify signals carrying voice, video, or data for air-to-satellite-to-ground communications. The company serves satellite systems integrators, wireless and other communication service providers, broadcasters, defense contractors, military, governments, and oil companies. Comtech markets its products through independent representatives and value-added resellers. The company was founded in 1967 and is headquartered in Melville, New York.

Joe Gomes, Senior Research Analyst, Noble Capital Markets, Inc.

Kevin Wahle, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

    Outerbridge Letter. Yesterday, Outerbridge Capital announced it had delivered a letter to Comtech's BoDs seeking a review of strategic alternatives. According to the letter, while Outerbridge believes "Comtech continues to be a market leader with best-in-class products and strong growth prospects, the Company...remains significantly undervalued." Outerbridge values CMTL shares in the $32-$40 range.

    Who Is Outerbridge? Founded by Rory Wallace, Outerbridge is a New York-based investment adviser that typically invests across the technology and technology-impacted sectors.  Probably its most well known play was at Barnes & Noble Education, where Outerbridge also pushed for a strategic review. Ultimately, the investment advisor ended up with two Board seats ...

This research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary.  Proper due diligence is required before making any investment decision. 

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