BofA double-upgrades CommScope to Buy after flagship unit sale
The brokerage also lifted its price target on the stock to $20 from $4. CommScope is selling its CCS segment, which accounted for as much as three-quarters of the company's core earnings, to Amphenol (NYSE:APH). BofA said the deal is part of a broader breakup strategy that aims to cut debt, repurchase Carlyle's preferred equity, and refocus the company on its remaining businesses.
CommScope has trimmed about $2 billion in debt since January, helping its shares climb from under $3 to $7.75 last week. The latest sale is expected to generate proceeds that will further reduce its $7.4 billion debt load and allow it to retire Carlyle's $1.26 billion in preferred equity.
After the sale, BofA sees the remaining units, Ruckus and ANS, as undervalued, trading at just 3 times estimated earnings. The brokerage values them at roughly double that multiple, citing expectations for 9% annual growth and an 18% margin through 2025.
Ruckus and ANS posted strong second-quarter growth, up 47% and 65% year-on-year, respectively. But management expects earnings to ease in the second half due to one-time factors and typical industry swings.
Even with more modest near-term guidance, BofA sees a clearer balance sheet and stronger focus driving further gains in the stock.
Related articles
BofA double-upgrades CommScope to Buy after flagship unit sale
Victoria's Secret Exposed: The Warning Sign Behind the Stock's 52% Collapse
Risks Rising? Smart Money Dodged 46%+ Drawdowns on These High-Flying Names
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
44 minutes ago
- Yahoo
1 Brilliant Artificial Intelligence (AI) Stock Down 70% You Might Regret Not Buying on the Dip in August
Key Points Lemonade is an insurance technology company, and artificial intelligence (AI) is at the core of everything it does. Lemonade stock surged by 30% on Aug. 5, after the company revealed a stellar set of operating results for the second quarter of 2025. The stock remains 70% below its 2021 record high, but a full recovery is looking increasingly likely. 10 stocks we like better than Lemonade › Last week, I predicted Lemonade (NYSE: LMND) stock would surge once the company released its operating results for the second quarter of 2025 (ended June 30) on Aug. 5. It rocketed higher by 30% on the day, thanks to a spectacular report that showed continued momentum across the business. Lemonade sells insurance, but with a twist: It relies on artificial intelligence (AI) to write quotes, process claims, and even price premiums, creating a faster, more convenient experience compared to traditional insurance companies. Despite its recent gains, Lemonade stock is still trading 70% below its record high from 2021, when a frenzy in the technology sector drove its valuation to unsustainable heights. However, the company believes it can grow its business tenfold over the next decade, so the recent upside in its stock could have serious legs. Lemonade's customer base is growing rapidly Lemonade operates in the renters, homeowners, pet, life, and car insurance markets. Prospective customers who want a quote can visit its website and speak to an AI chatbot named Maya, which can provide one in under 90 seconds. Existing policyholders who need to make a claim can go through AI Jim, which can pay them out in less than three minutes without human intervention. Lemonade's approach is in stark contrast to the processes at traditional insurance companies, especially when it comes to claims, which often require several phone calls and lengthy waiting periods. Its popularity is soaring as a result; Lemonade had a record 2.7 million customers at the end of the second quarter, which was up 24% from the year-ago period. That growth rate marked an acceleration from its first-quarter result of 21%, which highlights the company's momentum. Further, Lemonade's in-force premium (IFP, or the combined value of premiums from all outstanding policies) reached a record high of $1.08 billion in Q2, representing a 29% year-over-year increase. That was the seventh straight quarter in which IFP growth accelerated. But there is more to Lemonade's success than its fantastic customer experience. The company's Lifetime Value (LTV) models, which are powered by AI, calculate the likelihood of a customer making a claim, switching insurers, and even buying multiple policies, in order to charge the most accurate premiums. These models also identify products and geographic markets that are underperforming, so management can pivot its operating costs to maximize revenue. Lemonade significantly increased its revenue guidance for 2025 Lemonade's soaring IFP wouldn't mean much without a sustainable gross loss ratio, which is the proportion of premiums paid out as claims. The company believes a gross loss ratio of 75% is the sweet spot for a thriving insurance business, and it came in at an even better level of 70% during the second quarter. When IFP increases and gross losses decline, the net result is more revenue. After discounting the premiums Lemonade paid to other insurers to reduce risk, its revenue came in at a record $164.1 million during Q2, which was up 35% year over year. That was comfortably above management's forecast of $158 million. On the back of the strong result, management increased its full-year revenue guidance for 2025 by a staggering $50.5 million, from $662 million to $712.5 million. With all of that said, there is still some room for improvement at the bottom line. Lemonade's preferred measure of profitability is adjusted earnings before interest, tax, depreciation, and amortization (EBITDA), where it lost $40.9 million during Q2. But it was better than the adjusted EBITDA loss of $43 million from the year-ago period, so the company is on the right track. Plus, Lemonade had over $1 billion in liquidity on its balance sheet at the end of Q2, so it has plenty of runway to continue investing aggressively in growth initiatives, as long as its losses don't increase too dramatically from current levels. Lemonade stock might be cheap right now When Lemonade stock peaked during the tech frenzy in 2021, its price-to-sales (P/S) ratio topped 90, which was completely unsustainable. But the decline in the stock since then, combined with the company's surging revenue growth, has pushed its P/S ratio down to just 6.1. That's near the cheapest level since Lemonade went public. Therefore, the stock still looks very attractive, even after the blistering gains that followed its Q2 earnings report. As I mentioned, the recovery in Lemonade stock might just be getting started. The company plans to grow its IFP to $10 billion over the next decade, representing a near-tenfold increase from its current level, so investors willing to hold this stock for the long term could reap significant rewards from here. Should you buy stock in Lemonade right now? Before you buy stock in Lemonade, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Lemonade wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $635,544!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,099,758!* Now, it's worth noting Stock Advisor's total average return is 1,046% — a market-crushing outperformance compared to 181% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of August 4, 2025 Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Lemonade. The Motley Fool has a disclosure policy. 1 Brilliant Artificial Intelligence (AI) Stock Down 70% You Might Regret Not Buying on the Dip in August was originally published by The Motley Fool Sign in to access your portfolio
Business Insider
2 hours ago
- Business Insider
RBC Capital Sticks to Their Buy Rating for Westlake Corporation (WLK)
In a report released on August 7, Arun Viswanathan from RBC Capital maintained a Buy rating on Westlake Corporation, with a price target of $92.00. The company's shares closed yesterday at $79.00. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Viswanathan covers the Basic Materials sector, focusing on stocks such as DuPont de Nemours, PPG Industries, and Linde. According to TipRanks, Viswanathan has an average return of -4.3% and a 44.22% success rate on recommended stocks. In addition to RBC Capital, Westlake Corporation also received a Buy from Citi's Patrick Cunningham in a report issued on August 6. However, yesterday, TR | OpenAI – 4o reiterated a Hold rating on Westlake Corporation (NYSE: WLK). Based on the recent corporate insider activity of 44 insiders, corporate insider sentiment is neutral on the stock. Most recently, in June 2025, Robert Buesinger, the EVP, PEM Segment Head of WLK sold 83.00 shares for a total of $6,034.10.
Yahoo
2 hours ago
- Yahoo
Jim Cramer on Roblox: 'I Think it's Really Fabulous'
Roblox Corporation (NYSE:RBLX) is one of the stocks on Jim Cramer's radar. A caller asked if it is a good time to invest in the stock, and Cramer replied: 'I do think it is. I think Dave Baszucki's doing a remarkable job. That was a terrific quarter. I think they could have the breakout year next year, and I want you to be in the story. I think it's really fabulous. I'm glad you asked me about it because it's very hard to find a story that has more growth than Roblox. Very good.' Roblox trading piggybank-vbGnCn_4Pdo-unsplash Roblox (NYSE:RBLX) operates an interactive platform that enables users to explore, create, and share 3D experiences through tools like Roblox Client, Roblox Studio, and Roblox Cloud. When a caller inquired about the company in a June episode, Cramer responded: 'Roblox goes higher. Dave Baszucki, it turns out to be the real deal, and I know that some people were concerned that they weren't doing the right thing, ethically. I see it. I think Baszucki, ethical man, ethical product. People really like it.' While we acknowledge the potential of RBLX as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy Right Now. Disclosure: None. This article is originally published at Insider Monkey. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
