CommScope Holding (COMM) AI Stock Analysis

• Market Cap: $3.55B
• Dividend Yield: N/A
• Average Volume (3M): 9.38M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.97
• Revenue Growth: -11.03%
• EPS Growth: 91.98%
• Country: US
• Employees: 20,000
• Sector: Technology
• Sector Strength: 87
• Industry: Communication Equipment
• EPS (TTM): 0.44
• Shares Outstanding: 221,525,710
• 10 Day Avg. Volume: 6,670,705
• 30 Day Avg. Volume: 9,380,815
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 2.80
• Enterprise Value/Revenue: 2.10
• Enterprise Value/Gross Profit: 5.12
• Enterprise Value/Ebitda: 11.95
• 1Y Price Target: $16.67
• Price Target Upside: 3.93% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

• Rating: 59 Neutral
• Price Target: $16.50 ▲(2.87% Upside)

CommScope's overall stock score is primarily influenced by its strong technical momentum and positive earnings call, which highlight strategic initiatives and growth potential. However, significant financial risks and valuation concerns due to high leverage and negative earnings weigh heavily on the score.

Positive Factors

Debt Reduction

CommScope monetized its most valuable remaining asset, announcing the sale of its CCS business for $10.5bn, which allows the company to emerge from its debt load.

Financial Performance

CommScope reported Q2'25 non-GAAP core revenue and core EBITDA significantly ahead of market expectations.

Growth Outlook

Fundamentals have improved thanks to post-pandemic inventory normalization and cable TV upgrades, with a strong growth outlook led by cloud operator demand.

Negative Factors

Debt Levels

The stock continues to be constrained by the high debt levels, with a high net leverage ratio of 7.8x.

Equity Limitations

Despite debt paydown in previous quarters and positive business momentum, the stock continues to be range bound between $3-$7 over the past few quarters.

Interest Burden

Equity upside potential is constrained by high interest burden and minimal cash flow generation in 2025 due to $600mn+ in debt interest and $200mn in operating costs.

CommScope Holding Business Overview & Revenue Model

Company Description

CommScope Holding Company, Inc. is a global leader in infrastructure solutions for communication networks. The company operates primarily in the telecommunications, enterprise, and broadband sectors, providing a diverse range of products and services that include wired and wireless network solutions, fiber optic and copper cabling, antennas, and connectivity solutions. CommScope's innovative technologies support the increasing demand for high-speed data transmission and enable communication service providers and enterprises to build and maintain their networks efficiently.

How the Company Makes Money

CommScope generates revenue through multiple streams, primarily by selling its network infrastructure products and services to telecommunications operators, enterprises, and data center operators. Key revenue sources include the sale of hardware such as fiber optic cables, connectivity solutions, and wireless infrastructure products. Additionally, the company offers professional services, including network design, installation, and maintenance, which contribute to its revenue. Significant partnerships with major telecommunications companies and service providers also enhance its market presence and sales potential, while ongoing investments in research and development enable CommScope to innovate and adapt to the evolving needs of the communication industry.

CommScope Holding Financial Statement Overview

Summary

CommScope Holding's financial performance is challenged by high leverage and negative equity, posing substantial risks. While there are positive signs in revenue growth and cash flow management, profitability remains a concern with fluctuating net profit margins and low EBIT and EBITDA margins.

Income Statement

CommScope Holding's income statement shows a mixed performance. The TTM data indicates a modest revenue growth rate of 2.5%, but the company has faced significant challenges in maintaining profitability, with fluctuating net profit margins. The gross profit margin has improved to 40.94% in the TTM, indicating better cost management. However, the net profit margin of 18.85% is largely due to a one-time gain, as historical data shows negative net income. EBIT and EBITDA margins have shown some improvement, but remain relatively low, highlighting ongoing operational challenges.

Balance Sheet

The balance sheet reveals significant financial leverage, with a negative stockholders' equity leading to an undefined debt-to-equity ratio. This indicates high financial risk and potential solvency issues. The return on equity is negative, reflecting the company's inability to generate profits from its equity base. The equity ratio is also negative, further emphasizing the company's reliance on debt financing.

Cash Flow

Cash flow analysis shows some positive trends, with a free cash flow growth rate of 8.29% in the TTM. The operating cash flow to net income ratio is 0.25, indicating that cash generation from operations is relatively stable. However, the free cash flow to net income ratio of 0.85 suggests that while the company is generating cash, it is not translating into net income effectively. Overall, cash flow management appears to be improving, but challenges remain in converting cash flow into profitability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.75B	4.21B	5.79B	9.23B	8.59B	8.44B
Gross Profit	1.95B	1.58B	2.15B	2.80B	2.68B	2.75B
EBITDA	833.20M	648.10M	519.10M	85.30M	813.00M	746.60M
Net Income	815.10M	-315.50M	-1.45B	-1.29B	-462.60M	-573.40M
Balance Sheet
Total Assets	7.74B	8.75B	9.37B	11.69B	13.26B	13.58B
Cash, Cash Equivalents and Short-Term Investments	571.10M	564.90M	543.80M	398.10M	360.30M	521.90M
Total Debt	7.28B	9.27B	9.32B	9.50B	9.51B	9.52B
Total Liabilities	8.92B	10.98B	11.18B	12.13B	12.36B	12.18B
Stockholders Equity	-1.18B	-2.23B	-1.81B	-445.70M	899.50M	1.40B
Cash Flow
Free Cash Flow	248.10M	247.80M	236.60M	88.70M	-9.10M	315.00M
Operating Cash Flow	290.20M	273.10M	289.90M	190.00M	122.30M	436.20M
Investing Cash Flow	2.01B	-57.20M	38.30M	-82.10M	-136.80M	-120.20M
Financing Cash Flow	-2.08B	-83.00M	-181.70M	-65.00M	-139.50M	-383.80M

CommScope Holding Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 16.04
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For COMM, the sentiment is Positive. The current price of 16.04 is above the 20-day moving average (MA) of 15.45, above the 50-day MA of 10.89, and above the 200-day MA of 6.58, indicating a bullish trend. The MACD of 1.59 indicates Positive momentum. The RSI at 72.74 is Negative, neither overbought nor oversold. The STOCH value of 66.83 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for COMM.

CommScope Holding Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DGII	78 Outperform	$1.29B	30.45	7.21%	―	-2.37%	147.46%
HLIT	78 Outperform	$1.09B	16.44	16.36%	―	24.14%	16.17%
GILT	69 Neutral	$536.99M	23.99	7.49%	―	19.67%	12.32%
EXTR	67 Neutral	$2.83B	―	-16.44%	―	2.05%	91.37%
Sector *	61 Neutral	$35.42B	7.71	-10.08%	1.88%	8.71%	-9.18%
COMM	59 Neutral	$3.55B	―	17.08%	―	-11.03%	91.98%
ADTN	57 Neutral	$750.89M	―	-53.68%	―	3.52%	81.33%

CommScope Holding Corporate Events

CommScope Sells Connectivity Segment to Amphenol

On August 3, 2025, CommScope Holding Company, Inc. entered into a Purchase Agreement with Amphenol Corporation to sell its Connectivity and Cable Solutions segment for approximately $10.5 billion. The transaction, expected to close in the first half of 2026, is subject to various conditions, including regulatory approvals and stockholder consent. This strategic move will result in a change of control for CommScope, impacting its financial structure and market positioning. The agreement includes provisions for employee retention and intellectual property rights, ensuring a smooth transition for stakeholders.

CommScope Sells Connectivity Business to Amphenol

On August 4, 2025, CommScope announced its agreement to sell its Connectivity and Cable Solutions business to Amphenol Corporation for $10.5 billion in an all-cash transaction, expected to close in the first half of 2026. This strategic move aims to unlock equity value, repay debt, and distribute excess cash to shareholders, while focusing on the growth potential of its ANS and RUCKUS businesses, which have shown strong performance in the second quarter of 2025 with significant increases in sales and adjusted EBITDA.

CommScope Sells Connectivity Segment for $10.5 Billion

On August 4, 2025, CommScope announced an agreement to sell its Connectivity and Cable Solutions segment to Amphenol Corporation for $10.5 billion in cash. The transaction is expected to close in the first half of 2026, pending regulatory approvals and shareholder votes. CommScope plans to use the net proceeds of approximately $10 billion to repay debt, redeem preferred equity, and distribute excess cash as dividends to shareholders. This strategic move is aimed at unlocking equity value, strengthening remaining businesses, and focusing on the development of next-generation network connectivity.

CommScope Declares Dividend on Series A Preferred Stock

On June 18, 2025, CommScope’s Board of Directors declared a dividend on its Series A Preferred Stock, which will be paid on June 30, 2025, in the form of additional shares and cash. This decision reflects the company’s ongoing financial strategies and its relationship with Carlyle Partners, highlighting its commitment to shareholder value and investment growth.