Comtech Telecommunications (Comtech Telecommunications) Predictability Rank

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What is Comtech Telecommunications Predictability Rank?

Warren Buffett said many times that the companies he likes are:

1. Simple businesses that he understands
2. that have predictable and proven earnings and
3. with economic moat
4. those can be bought at a reasonable price.

It is hard to quantify "simple businesses that he (Buffett) understands", so we will focus on the other three characteristics instead. In GuruFocus Research: What worked in the market from 1998-2008? Part I: Introduction of Predictability Rank, we will show that the businesses that have predictable and proven earnings are usually also simple businesses that an average person could understand.

GuruFocus conducted a back test study of Warren Buffett's strategy of "buying good companies at fair prices" for the years from 1998-2008.

Comtech Telecommunications Predictability Rank Calculation

In our database there are 2403 stocks that have been traded from Jan. 2, 1998 to Aug. 31, 2008. We have the complete 10-year financial data and trading prices of these companies for this period. We rank the predictability of these companies based on the consistency of their revenue per share and EBITDA (earning before interest, tax, depreciation and amortization) per share over the past ten fiscal years, and study the correlation between the stock performances and the predictability of the business.

Our study may be subject to these biases and assumptions:

Dividend yields are not counted for investment returns
Effects of price changes due to spin-offs may not be fully adjusted
Study is subjected to survivorship bias due to de-listing, bankruptcy, LBO, M&A, etc.

The correlation between business predictability and investment returns of a company is showed below.

Correlation Between Business Predictability and Investment Returns

	Predictables	Non-Predictable	All stocks
Total Number of stocks	570	1833	2403
Total Lost Money	61	830	891
Total Lost More Than 50%	18	412	430
Total Lost More Than 90%	4	86	90
Average Gain	260.6%	100.0%	138.1%
Median Gain	150.0%	13.0%	39.0%
Maximum Gain	2852.0%	11483.0%	11483.0%
Maximum Loss	-100.0%	-100.0%	-100.0%
Annualized Average Gain	12.7%	6.7%	8.4%
Annualized Median Gain	8.9%	1.1%	3.1%

For the 570 predictable companies, we have seen strong correlation between the predictability of businesses and the stock performances over the past 10 years, regardless of the valuation of business at 1998. Accordingly, we have ranked the business predictability from 5-star to 1-star, as shown in this table.

Predictability Rank	5-Star	4.5-Star	4-Star	3.5-Star	3-Star	2.5-Star	2-Star	1-Star (non-predictable)	Average among all
% Out of All 2403 Stocks	3.3%	2.9%	3.7%	3.3%	3.3%	3.7%	3.3%	76.3%	100%
% that are in Loss (10y)	3%	10%	8%	9%	11%	18%	16%	45%	37%
Average Gain (10y)	364.6%	330.9%	278.0%	235.1%	243.5%	227.8%	154.8%	100.0%	138.1%
Median Gain (10y)	238.5%	193.5%	171.0%	159.0%	132.5%	113.5%	87.0%	13.0%	39.0%
Maximum Gainer	2228.0%	2547.0%	2452.0%	2852.0%	2432.0%	1892.0%	1807.0%	11483.0%	11483.0%
Maximum Loser	-82.0%	-53.0%	-67.0%	-100.0%	-83.0%	-100.0%	-78.0%	-100.0%	-100.0%
Annualized Average Gain	15.4%	14.6%	13.2%	12.0%	12.2%	11.7%	9.1%	6.7%	8.4%
Annualized Median Gain	12.1%	10.6%	9.8%	9.3%	8.2%	7.3%	6.0%	1.1%	3.1%

For detailed information about each predictability rank, please go to GuruFocus Research: What worked in the market from 1998-2008? Part I: Introduction of Predictability Rank

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Comtech Telecommunications (Comtech Telecommunications) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Hardware » Comtech Telecommunications Corp (NAS:CMTL) » Definitions » Predictability Rank

Comparable Companies

Traded in Other Exchanges

CC6:Germany CC6:Germany

Address

68 South Service Road, Suite 230, Melville, NY, USA, 11747

Website

https://www.comtechtel.com

Comtech Telecommunications Corp is a provider of modern communications solutions. The company is engaged in designing, developing, producing and marketing products, systems, and services for communications solutions. It is engaged in two business segments, Satellite and Space Communications and Terrestrial and Wireless Networks. Majority of sales are generated from Satellite and Space Communications segment.

Executives

Wendi B. Carpenter	director	2401 EAST 86TH ST., BLOOMINGTON MN 55425
Mark R. Quinlan	director	150 EAST 52ND STREET, 21ST FLOOR, NEW YORK NY 10022
Bruce T Crawford	director	255 SOUTH KING ST., SUITE 1800, SEATTLE WA 98104
Ellen M. Lord	director	1100 N. WOOD DALE ROAD, WOOD DALE IL 60191
Maria Hedden	officer: Chief Operating Officer	68 SOUTH SERVICE ROAD, SUITE 230, MELVILLE NY 11747
Donald E. Walther	officer: Chief Legal Officer	500 108TH AVENUE NE, SUITE 1500, BELLEVUE WA 98004
Michael Bondi	officer: Corporate Controller	68 SOUTH SERVICE ROAD, SUITE 230, MELVILLE NY 11747
Ken Allen Peterman	director	68 SOUTH SERVICE ROAD, SUITE 230, MELVILLE NY 11747
Yelena Simonyuk	officer: Chief Legal Officer	68 S. SERVICE ROAD, SUITE 230, MELVILLE NY 11747
Michael Porcelain	officer: VP of Finance & Internal Audit	68 SOUTH SERVICE ROAD, SUITE 230, MELVILLE NY 11747
Yacov A Shamash	director
Lisa /adv Lesavoy	director	166 E 63RD ST, NEW YORK NY 10021
Judy Chambers	director	68 SOUTH SERVICE ROAD, SUITE 230, MELVILLE NY 11747
Richard L Burt	officer: Sr. Vice President	68 SOUTH SERVICE ROAD, SUITE 230, MELVILLE NY 11747
John Branscum	officer: Sr. Vice President	COMTECH TELECOMMUNICATIONS CORP., 68 SOUTH SERVICE RD., SUITE 230, MELVILLE NY 11747