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Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

Research from Water Tower Research

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Equity Bottom-Up

<ul><li>Cambium Networks (CMBM) reported earnings on May 9 that came in below our expectations (we were the lowest on the Street), mainly due to a delay in FTC approval of 6 GHz spectrum.</li><li>This also hit gross margin, which came in at <span style="font-size: var(--content-font-size);">22.7%. Company expectations are for a better 2Q24 and 2H24, </span>but with continued challenges in inventory and the move to 6 GHz.</li><li>The company did see a recovery in the enterprise market in 1Q24, but not enough to offset the weakness in 6 GHz. The stock <span style="font-size: var(--content-font-size);">dropped 13% in the aftermarket.</span></li></ul>

Cambium Networks (CMBM) reported earnings on May 9 that came in below our expectations (we were the lowest on the Street), mainly due to a delay in FTC approval of 6 GHz spectrum.This also hit gross margin, which came in at 22.7%. Company expectations are for a better 2Q24 and 2H24, but with continued challenges in inventory and the move to 6 GHz.The company did see a recovery in the enterprise market in 1Q24, but not enough to offset the weakness in 6 GHz. The stock dropped 13% in the aftermarket.

Cambium Networks Corporation - 1Q24 Earnings Weak on 6 GHz Delay