TESSCO Technologies Stock Increases Over 20% Pre-Market: Why It Happened

By Amit Chowdhry ● Jul 8, 2021
  • The stock price of TESSCO Technologies, Inc. (NASDAQ: TESS) increased by over 20% pre-market. This is why it happened.

The stock price of TESSCO Technologies, Inc. (NASDAQ: TESS) – a leading value-added distributor and solutions provider for the wireless industry – increased by over 20% pre-market. Investors appear to be responding positively to TESSCO Technologies announcing the preliminary select financial results for the first quarter of its 2022 fiscal year, ended June 27, 2021. 

Tessco is expecting to report total revenues of approximately $105 million, which would represent composite growth of 9% year over year. And sales bookings for the first quarter grew 37% year over year with improved performance across both of the company’s markets.

The second-half fiscal 2021 sales bookings were higher than in the first half of the fiscal year as the effects of the pandemic had lessened. And the company also reported a growing backlog due to the supply chain challenges that delayed the conversion of bookings to shipments.

The growth in the sales bookings was up 37% compared with the first quarter of the fiscal year 2022 with the public carrier market growing 64% and the VAR and Integrator market growing 21%.

The company expects to report a pre-tax and adjusted EBITDA loss for the first quarter. And the company sharpened its focus on cost controls and currently expects significant improvement in our overall profitability this fiscal year as compared to fiscal 2021. 

The financial highlights of this operating plan include:

— Projected full-year revenue of $408M to $442M (compared to $373M in the fiscal year 2021)

— Projected full-year net loss of $6.5M to $4.1M (compared to $14.3M in the fiscal year 2021)

— Projected full-year adjusted EBITDA of $0.0M to $2.4M (compared to a loss of $12.8M in the fiscal year 2021).

KEY QUOTE:

“This fiscal year is our first after the sale of our retail business and, despite some global supply-chain disruptions, we are now seeing signs of a post-pandemic recovery across our markets. As such, and as we welcome the vast majority of our employees back to our offices after a long period of remote working, we believe this is a prudent time to provide a high-level overview of our expected results for our first quarter, along with certain financial expectations for our full fiscal year 2022.”

— Sandip Mukerjee, Tessco’s president and chief executive officer

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.