CommScope Holding (COMM) AI Stock Analysis

• Market Cap: $699.49M
• Dividend Yield: N/A
• Average Volume (3M): 6.02M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.12
• Revenue Growth: -28.32%
• EPS Growth: 73.59%
• Country: US
• Employees: 20,000
• Sector: Technology
• Sector Strength: 44
• Industry: Communication Equipment
• EPS (TTM): -1.89
• Shares Outstanding: 216,560,560
• 10 Day Avg. Volume: 5,433,803
• 30 Day Avg. Volume: 6,016,904
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.29
• Price to Cash Flow (P/CF): 1.10
• P/FCF Ratio: 0.70
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $4.98
• Price Target Upside: 54.18% Upside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 5

CommScope's overall score reflects significant financial challenges, including negative profitability and high leverage. Despite positive guidance from the earnings call and strategic leadership changes, technical indicators and valuation concerns weigh heavily on the stock. Immediate strategic actions are required to stabilize and improve the company's financial health.

Positive Factors

Business Segment Growth

CCS (cables and connectivity, 65% of revenue) grew 36% YoY, and management expects this segment to exhibit elevated growth for multiple years, driven mainly by its 30% annual Data Center growth.

Earnings and Revenue Growth

4Q results were better than expected, and management’s indications of 20% FY25 revenue growth and EBITDA of $1.025bn were well above expectations.

Negative Factors

Debt and Financial Constraints

Limited upside potential to the equity is seen given the high debt level, limited FCF generation, and valuation considerations.

Leverage and Valuation

High leverage burdens the valuation, with a 2025 EV/EBITDA of 11.5x above the historic range of 9-10x.

CommScope Holding Business Overview & Revenue Model

Company Description

CommScope Holding Company, Inc. provides infrastructure solutions for communications and entertainment networks. It operates through four segments: Broadband Networks (Broadband), Outdoor Wireless Networks (OWN), Venue and Campus Networks (VCN), and Home Networks (Home). The Broadband segment provides converged cable access platforms, passive optical networking products, video systems, access technologies, fiber and coaxial cables, fiber and copper connectivity products, and hardened closures to the telco and cable provider broadband market. The OWN segment provides base station antennas, radio frequency filters, tower connectivity, microwave antennas, metro cell products, cabinets, steel towers, accessories, Spectrum Access System, and Comsearch products to the macro and metro cell markets. The VCN segment offers Wi-Fi and switching, distributed antenna systems, licensed and unlicensed small cells, enterprise fiber, and copper infrastructures for campuses, venues, data centers, and buildings. The Home segment provides devices and related software, and management solutions that offer residential connectivity and services to subscribers, such as digital subscriber lines, cable modems, and telephony and data gateways; and set top boxes and software that support cable, satellite, and Internet protocol television content delivery, which include digital video recorders, high definition set top boxes, and hybrid set top devices. It offers its products and services through specialized resellers and distributors, satellite video distributors, and system integrators, as well as directly to customers in the United States, Europe, the Middle East, Africa, the Asia Pacific, the Caribbean, Latin America, and Canada. The company was formerly known as Cedar I Holding Company, Inc. and changed its name to CommScope Holding Company, Inc. in January 2011. CommScope Holding Company, Inc. was founded in 1976 and is headquartered in Hickory, North Carolina.

How the Company Makes Money

CommScope generates revenue through the sale of its comprehensive portfolio of network infrastructure products and solutions. The company's revenue streams are primarily derived from its four business segments: Broadband Networks, Home Networks, Outdoor Wireless Networks, and Venue and Campus Networks. It earns money by providing products such as fiber optic cables, copper cables, antennas, and network management software. CommScope also benefits from strategic partnerships with telecom and broadband service providers, enterprises, and government entities, which contribute to its sales. The company's ability to innovate and adapt to emerging technology trends, such as 5G, further enhances its revenue potential.

CommScope Holding Financial Statement Overview

Summary

CommScope faces significant financial challenges with declining revenues and a concerning balance sheet. The income statement highlights operational inefficiencies, while the balance sheet reflects high leverage and financial instability due to negative equity. Cash flow remains positive, which is a positive sign amidst financial struggles.

Income Statement

CommScope Holding has shown a declining revenue trend over the years with a significant drop in TTM (Trailing-Twelve-Months) revenue compared to the previous year. The gross profit margin for TTM stands at 37.5%, but the net profit margin is negative due to continued net losses. EBIT margin is 6.1%, showing some operational efficiency, but EBITDA is negative, indicating potential operational cash flow issues. The company needs to improve its revenue growth and manage costs more effectively.

Balance Sheet

The balance sheet shows a concerning financial structure with negative stockholders' equity of -$2.23 billion as of TTM. The company has a high debt-to-equity ratio due to its negative equity, posing financial risk. Return on equity is not meaningful due to negative net income and equity. The equity ratio is also negative, indicating insolvency issues. Overall, the balance sheet reflects high leverage and financial instability.

Cash Flow

Despite negative net income, CommScope Holding has managed to maintain positive operating cash flow. The free cash flow has seen a slight increase from the previous year, reflecting some operational cash generation capability. However, the free cash flow to net income ratio is challenging to interpret due to negative net income. The company needs to focus on improving cash flow from operations to support its capital structure.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
4.21B	5.79B	9.23B	8.59B	8.44B
	Gross Profit
1.58B	2.15B	2.80B	2.68B	2.75B
	EBIT
256.50M	-112.90M	471.40M	132.30M	218.40M
	EBITDA
648.10M	519.10M	85.30M	813.00M	746.60M
	Net Income Common Stockholders
-380.70M	-1.45B	-1.29B	-462.60M	-573.40M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
564.90M	543.80M	398.10M	360.30M	521.90M
	Total Assets
8.75B	9.37B	11.69B	13.26B	13.58B
	Total Debt
9.24B	9.32B	9.50B	9.51B	9.52B
	Net Debt
8.67B	8.77B	9.10B	9.15B	9.00B
	Total Liabilities
10.98B	11.18B	12.13B	12.36B	12.18B
	Stockholders Equity
-2.23B	-1.81B	-445.70M	899.50M	1.40B
Cash Flow		Free Cash Flow
247.80M	236.60M	88.70M	-9.10M	315.00M
	Operating Cash Flow
273.10M	289.90M	190.00M	122.30M	436.20M
	Investing Cash Flow
-57.20M	38.30M	-82.10M	-136.80M	-120.20M
	Financing Cash Flow
-83.00M	-181.70M	-65.00M	-139.50M	-383.80M

CommScope Holding Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3.23
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For COMM, the sentiment is Negative. The current price of 3.23 is below the 20-day moving average (MA) of 4.20, below the 50-day MA of 4.90, and below the 200-day MA of 4.75, indicating a bearish trend. The MACD of -0.55 indicates Positive momentum. The RSI at 33.80 is Neutral, neither overbought nor oversold. The STOCH value of 16.37 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for COMM.

CommScope Holding Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GILT	71 Outperform	$354.65M	14.27	8.58%	―	14.79%	5.04%
DGII	68 Neutral	$977.46M	27.64	6.29%	―	-4.49%	119.80%
HLIT	66 Neutral	$1.01B	26.43	8.69%	―	11.65%	-55.58%
Sector *	58 Neutral	$9.99B	10.12	-6.46%	3.10%	7.47%	-11.60%
COMM	48 Neutral	$699.49M	―	17.08%	―	-28.32%	73.59%
ADTN	40 Underperform	$574.13M	―	-123.20%	―	-19.70%	-70.40%
EXTR	40 Underperform	$1.51B	―	-152.77%	―	-24.49%	-250.61%

CommScope Holding Corporate Events

CommScope Appoints New Senior VP for Financial Leadership

On March 28, 2025, CommScope Holding Company announced the appointment of Charles A. Gilstrap as Senior Vice President, Treasury, Tax & Chief Accounting Officer, effective April 1, 2025. This appointment marks a strategic move in the company’s leadership, with Mr. Gilstrap replacing Jennifer L. Crawford, who will return to her role as Segment CFO for Connectivity & Cable Solutions. The announcement also detailed Mr. Gilstrap’s compensation package and severance protection agreement, indicating a robust support structure for his new role. These changes are expected to strengthen CommScope’s financial management and align with its long-term strategic goals.