Financial Analysis: Comtech Telecomm. (CMTL) vs. Commscope (COMM)

Comtech Telecomm. (NASDAQ:CMTL) and Commscope (NASDAQ:COMM) are both computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, earnings, profitability, institutional ownership, risk, valuation and analyst recommendations.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Comtech Telecomm. and Commscope, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Comtech Telecomm. 0 2 4 0 2.67
Commscope 0 7 5 0 2.42

Comtech Telecomm. presently has a consensus target price of $33.80, indicating a potential upside of 0.72%. Commscope has a consensus target price of $34.15, indicating a potential upside of 22.49%. Given Commscope’s higher probable upside, analysts clearly believe Commscope is more favorable than Comtech Telecomm..

Earnings and Valuation

This table compares Comtech Telecomm. and Commscope’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Comtech Telecomm. $570.59 million 1.40 $29.76 million $0.75 44.75
Commscope $4.56 billion 1.18 $193.76 million $2.02 13.80

Commscope has higher revenue and earnings than Comtech Telecomm.. Commscope is trading at a lower price-to-earnings ratio than Comtech Telecomm., indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

86.9% of Comtech Telecomm. shares are held by institutional investors. 7.0% of Comtech Telecomm. shares are held by insiders. Comparatively, 3.4% of Commscope shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Dividends

Comtech Telecomm. pays an annual dividend of $0.40 per share and has a dividend yield of 1.2%. Commscope does not pay a dividend. Comtech Telecomm. pays out 53.3% of its earnings in the form of a dividend.

Risk & Volatility

Comtech Telecomm. has a beta of 1.51, meaning that its stock price is 51% more volatile than the S&P 500. Comparatively, Commscope has a beta of 0.99, meaning that its stock price is 1% less volatile than the S&P 500.

Profitability

This table compares Comtech Telecomm. and Commscope’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Comtech Telecomm. 5.22% 3.67% 2.17%
Commscope 4.43% 24.14% 5.63%

About Comtech Telecomm.

Comtech Telecommunications Corp. designs, develops, produces, and markets products, systems, and services for communications solutions. The company's Commercial Solutions segment provides ground-based equipment, such as single channel per carrier modems and solid state amplifiers that facilitate the transmission of voice, video, and data, as well as offers traveling wave tube amplifiers comprising high power narrow-band amplifiers that are used to amplify signals from satellite earth stations; and safety and security technology solutions that enable 911 c. This segment also offers enterprise application technologies, including location-based technology, such as Trusted Location, a software-based scoring system that allows providers to determine mobile location and identify fraudulent behavior and other security risks; Look4, an application that enables customers to build their own applications; Indoor Location, a solution that enables the determination of a cell phone user's geospatial position; text messaging platforms that are used by wireless carriers to provide short-messaging services and to communicate with 911 public safety answering points; and VirtuMedix, a digital health platform that enables virtual healthcare. The company's Government Solutions segment provides command and control technologies, including tactical communications, managed networks, logistics, and end-to-end integration; cyber security training and computer network operations; and satellite-based mobile communications and tracking systems. This segment also offers over-the-horizon microwave systems, such as equipment and systems that transmit digitized voice, video, and data; and solid state high power broadband amplifiers designed for radar, electronic warfare, jamming, medical, and aviation applications. The company serves commercial and government customers worldwide. Comtech Telecommunications Corp. was founded in 1967 and is headquartered in Melville, New York.

About Commscope

CommScope Holding Company, Inc. provides infrastructure solutions for communications networks worldwide. The company's CommScope Connectivity Solutions segment offers optical fiber and twisted pair structured cable solutions, intelligent infrastructure software, and network rack and cabinet enclosures under the SYSTIMAX, NETCONNECT, and Uniprise brands; and fiber management systems, patch cords and panels, pre-terminated fiber connectivity, complete cabling systems, and cable assemblies for use in offices and data centers. This segment also provides fiber optic connectivity solutions, including hardened connector systems, fiber distribution hubs and management systems, couplers and splitters, plug and play multiport service terminals, hardened optical terminating enclosures, high density cable assemblies, splices, and splice closures that supports video, voice, and high-speed data services provided by telecommunications operators and multi-system operators. Its CommScope Mobility Solutions segment offers macro cell site solutions for wireless tower sites and on rooftops, such as base station antennas, microwave antennas, hybrid fiber-feeder and power cables, coaxial cables, connectors, and filters; metro cell solutions for street poles and other urban structures comprising radio frequency delivery and connectivity solutions, equipment housing, and concealment; and small cell and distributed antenna system (DAS) solutions consisting of DAS and distributed cell solutions that allow wireless operators to enhance efficiency, and cellular coverage and capacity in network conditions. This segment provides its solutions under the Andrew brand. CommScope Holding Company, Inc. sells its products through a network of distributors, system integrators, and resellers. The company was formerly known as Cedar I Holding Company, Inc. CommScope Holding Company, Inc. was founded in 1976 and is headquartered in Hickory, North Carolina.

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