Comtech Telecommunications (CMTL) – A Mutual Agreement – Change in Management

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Thursday, August 11, 2022

Comtech Telecommunications (CMTL)
A Mutual Agreement – Change in Management

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.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

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

Saying Goodbyes. Comtech’s management reported that the Company and CEO and President Michael Porcelain have mutually agreed to separate, effective immediately. Prior to the resignation, Mr. Porcelain was CEO of Comtech since January of 2022, COO in 2018, and CFO from 2005-2018. We believe the reasoning for the sudden change in management is the Board of Director’s desire for accelerated change at the Company and a desire for a fresh, outside CEO who can take a more dispassionate view.

The New Replacement. The person in charge of replacing Mr. Porcelain will be Ken Peterman, who previously joined the Board of Directors in May of 2022. Mr. Peterman has over 40 years in the defense industry, including tenures as CEO/President as well as VP/GM at entities such as Viasat, ITT/Exelis, Collins Aerospace, Raytheon, and SpyGlass Group. Accolades in his career include developing a $1B/year Tactical Defense Electronics Systems Division at Raytheon. Mr. Peterman has led major restructuring actions across twelve states plus the U.K. (with sales of ~$1.3B/yr) at ITT/Exelis. We believe Mr. Peterman to be a suitable replacement for Mr. Porcelain, given his history and accomplishments….

This Company Sponsored 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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