NasdaqGM:JCS

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Communications Systems

Executive Summary

Communications Systems, Inc., through its subsidiaries, manufactures and sells connectivity infrastructure products and services for broadband networks in North America, Europe, the Middle East, Africa, and internationally.


Snowflake Analysis

Flawless balance sheet and fair value.

Share Price & News

How has Communications Systems's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: JCS has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

2.9%

JCS

1.8%

US Communications

2.3%

US Market


1 Year Return

59.8%

JCS

-17.1%

US Communications

6.7%

US Market

Return vs Industry: JCS exceeded the US Communications industry which returned -17.1% over the past year.

Return vs Market: JCS exceeded the US Market which returned 6.7% over the past year.


Shareholder returns

JCSIndustryMarket
7 Day2.9%1.8%2.3%
30 Day-0.2%2.8%6.0%
90 Day0.2%11.8%18.9%
1 Year62.0%59.8%-14.8%-17.1%9.0%6.7%
3 Year27.2%16.1%36.0%27.1%36.6%27.7%
5 Year-40.2%-51.4%59.2%40.5%64.2%46.1%

Price Volatility Vs. Market

How volatile is Communications Systems's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Communications Systems undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: JCS ($4.97) is trading below our estimate of fair value ($84.79)

Significantly Below Fair Value: JCS is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: JCS is poor value based on its PE Ratio (197.6x) compared to the US Communications industry average (37.1x).

PE vs Market: JCS is poor value based on its PE Ratio (197.6x) compared to the US market (16.2x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate JCS's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: JCS is good value based on its PB Ratio (0.9x) compared to the US Communications industry average (1.9x).


Next Steps

Future Growth

How is Communications Systems forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

11.4%

Forecasted Tech industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Communications Systems has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has Communications Systems performed over the past 5 years?

20.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: JCS has a large one-off gain of $298.0K impacting its March 31 2020 financial results.

Growing Profit Margin: JCS became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: JCS has become profitable over the past 5 years, growing earnings by 20% per year.

Accelerating Growth: JCS has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: JCS has become profitable in the last year, making it difficult to compare its past year earnings growth to the Communications industry (-36.4%).


Return on Equity

High ROE: JCS's Return on Equity (0.5%) is considered low.


Next Steps

Financial Health

How is Communications Systems's financial position?


Financial Position Analysis

Short Term Liabilities: JCS's short term assets ($48.2M) exceed its short term liabilities ($7.6M).

Long Term Liabilities: JCS's short term assets ($48.2M) exceed its long term liabilities ($276.0K).


Debt to Equity History and Analysis

Debt Level: JCS is debt free.

Reducing Debt: JCS has no debt compared to 5 years ago when its debt to equity ratio was 0.7%.

Debt Coverage: JCS has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: JCS has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet


Next Steps

Dividend

What is Communications Systems's current dividend yield, its reliability and sustainability?

1.61%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: JCS's dividend (1.61%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.68%).

High Dividend: JCS's dividend (1.61%) is low compared to the top 25% of dividend payers in the US market (4.6%).


Stability and Growth of Payments

Stable Dividend: JCS's dividend payments have been volatile in the past 10 years.

Growing Dividend: JCS's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (318.1%), JCS's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

8.0yrs

Average management tenure


CEO

Roger Lacey (70yo)

6.08yrs

Tenure

US$472,194

Compensation

Mr. Roger H. D. Lacey has been the Chief Executive Officer of Communications Systems Inc. since February 27, 2015 and served as its President. Mr. Lacey has been Executive Chairman of Communications System ...


CEO Compensation Analysis

Compensation vs Market: Roger's total compensation ($USD472.19K) is about average for companies of similar size in the US market ($USD614.21K).

Compensation vs Earnings: Roger's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Roger Lacey
Executive Chairman6.08yrsUS$472.19k0.97% $449.4k
Mark Fandrich
CFO, Treasurerno dataUS$502.49k0.24% $110.0k
Curtis Sampson
Founder & Chairman Emeritus1.58yrsUS$23.19k12.5% $5.8m
Scott Fluegge
President & GM of JDL Technologies6.83yrsUS$309.70k0.29% $133.4k
Kristin Hlavka
Corporate Controller9.17yrsUS$200.67k0.20% $91.6k
Seweryn Sadura
General Manager of Suttleno dataUS$211.52kno data

8.0yrs

Average Tenure

54yo

Average Age

Experienced Management: JCS's management team is seasoned and experienced (8 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Roger Lacey
Executive Chairman6.08yrsUS$472.19k0.97% $449.4k
Curtis Sampson
Founder & Chairman Emeritus1.58yrsUS$23.19k12.5% $5.8m
Randall Sampson
Lead Independent Director1.58yrsUS$32.57k1.07% $498.8k
Richard Primuth
Independent Director6.75yrsUS$58.82k0.28% $129.9k
Steven Webster
Independent Director3.17yrsUS$30.69k0.053% $24.9k
Michael Zapata
Independent Director0.083yrno datano data

1.6yrs

Average Tenure

66.5yo

Average Age

Experienced Board: JCS's board of directors are not considered experienced ( 1.6 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: JCS insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Communications Systems, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Communications Systems, Inc.
  • Ticker: JCS
  • Exchange: NasdaqGM
  • Founded: 1969
  • Industry: Communications Equipment
  • Sector: Tech
  • Market Cap: US$46.477m
  • Shares outstanding: 9.35m
  • Website: https://www.commsystems.com

Number of Employees


Location

  • Communications Systems, Inc.
  • 10900 Red Circle Drive
  • Minnetonka
  • Minnesota
  • 55343
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
JCSNasdaqGM (Nasdaq Global Market)YesCommon StockUSUSDNov 1981

Biography

Communications Systems, Inc., through its subsidiaries, manufactures and sells connectivity infrastructure products and services for broadband networks in North America, Europe, the Middle East, Africa, and internationally. It operates through three segments: Transition Networks, JDL Technologies, and Net2Edge. The Transition Networks segment manufactures and sells Power over Ethernet switches, media converters, network interface cards, Ethernet switches, small form factor pluggable modules, and other connectivity and data transmission products. This segment sells its products through distributors, resellers, integrators, and original equipment manufacturers to the federal government, enterprise, service provider, industrial, security, and surveillance markets. The JDL Technologies segment offers information technology managed services, such as network design, deployment, and integration; cloud, hosted, and virtualization services; and remote support and management services to commercial, education, and healthcare markets. Its Net2Edge segment manufactures and markets Ethernet based network access devices. This segment serves government, enterprise, utility, industrial, and surveillance markets, as well as service providers through direct sales model, and approved partners and integrators. Communications Systems, Inc. was founded in 1969 and is headquartered in Minnetonka, Minnesota. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/13 00:12
End of Day Share Price2020/07/10 00:00
Earnings2020/03/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.