Latest news with #CommScope
Yahoo
a day ago
- Business
- Yahoo
BofA double-upgrades CommScope to Buy after flagship unit sale
-- Bank of America raised its rating on CommScope to Buy from Underperform after the network equipment maker agreed to sell its main business unit, saying this would help co reduce debt and reveals more value in what is remaining. 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
Channel Post MEA
2 days ago
- Business
- Channel Post MEA
CommScope Sells CCS Segment To Amphenol Corporation For $10.5 billion
CommScope has entered into a definitive agreement to sell its Connectivity and Cable Solutions (CCS) segment to Amphenol Corporation. CommScope is selling its CCS business to Amphenol for approximately USD $10.5 billion in cash, to be paid by Amphenol upon closing. The sale is expected to close within the first half of 2026, subject to customary closing conditions, including receipt of applicable regulatory approvals and the affirmative vote of the shareholders. The vote is required under Delaware law due to the nature and size of the transaction. The Company expects net proceeds after taxes and transaction expenses to be approximately $10 billion. After repaying all debt, redeeming all preferred equity, which is held by global investment firm Carlyle, and adding modest leverage on the remaining business, the Company will have significant excess cash. The Company expects to distribute this excess cash to shareholders as a dividend within 60 to 90 days following the closing of the proposed transaction. The exact amount and timing of the dividend will be determined by the Company after closing and after taking into account all relevant factors. 'I'm excited to announce this transformational deal that unlocks equity value, returns cash to our shareholders and strengthens our remaining businesses,' said Chuck Treadway, CEO, CommScope. 'ANS and RUCKUS will continue to stay focused on what matters most—our shareholders, customers, employees and other stakeholders. In our ANS and RUCKUS businesses, we will continue to develop the next generation of network connectivity. CommScope's CCS business is positioned to continue to perform well under Amphenol's leadership.'
Yahoo
3 days ago
- Business
- Yahoo
CommScope–Amphenol, Joby Aviation, Wayfair: Trending Tickers
CommScope (COMM) is selling its broadband and cable equipment unit to Amphenol (APH) for $10.5 billion in cash. Joby Aviation (JOBY) plans to acquire Blade's (BLDE) helicopter rideshare business for up to $125 million as it looks to scale its electric air taxi service across the US and Europe. Wayfair (W) stock is surging after better-than-expected second quarter results, with rising average order values signaling a potential rebound in the furniture market. To watch more expert insights and analysis on the latest market action, check out more Market Catalysts. Now time for some of today's trending tickers. We are watching ComScope, Joby Aviation, and Wayfair. First up, a 10 and a half billion dollar deal between ComScope and Amphenol. ComScope will sell its broadband and cable equipment arm to Amphenol for about 10 and a half billion dollars in cash. It's the second such deal it's done with Amphenol as part of a series of divestitures aimed at paying off its debt. Amphenol, for its part, has made a string of acquisitions in recent years. Last year's deal for ComScope's outdoor wireless networks and distributed antenna systems businesses was the biggest ever by the Connecticut based company at the time. This deal is expected to close in the first half of 2026. Next up is Joby Aviation. It said it plans to buy the helicopter rideshare business of Blade for as much as $125 million in stock or cash. The electric aviation pioneer is looking to expand its battery-powered air taxis into a ready-made market for its aircraft. The acquisition encompasses all of Blade's passenger business, including operations in the U.S. and Europe, as well as the Blade brand. Blade sells per-seat helicopter trips from New York City to nearby airports and resort towns. The company, which went public via SPAC four years ago, has not reported an annual profit since it listed. Company shares are down 10% this year, giving it a market value of just over $300 million. And finally, Wayfair shares are spiking today after the online retailer reported second quarter results that were much stronger than expected. Shares nearing a two-year high as results point to a potential recovery in the furniture market, which has previously felt the impact of a depressed housing market and consumers opting to spend their cash on essentials. Wayfair's average order value in the second quarter was $328, up from $313 in the prior year's quarter. And as always, you can scan the QR code below to track the best and worst performing stocks with Yahoo Finance's trending tickers page. Related Videos Wall Street Continues to Underestimates Palantir, Ives Says Pfizer, Caterpillar and Marriott: Market Movers US Futures point higher, BP and Palantir earnings beat: 3 Things Africa Top Stock Market Weighs 24-Hour Trading, Says CEO 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
Forbes
4 days ago
- Business
- Forbes
CommScope: More Upside For COMM Stock?
CommScope (NASDAQ: COMM) has undertaken a transformative $10.5 billion divestiture of its connectivity and cable solutions business to Amphenol, signifying a crucial milestone in the company's strategic restructuring. The market reacted dramatically with an 86% stock increase to roughly $15 per share, reflecting investor optimism regarding the potential of the transaction to alleviate the company's substantial debt burden and refocus operations on its core competencies. However, if you are seeking an upside with a smoother experience than an individual stock, consider the High Quality portfolio, which has surpassed the S&P and achieved over 91% returns since its inception. Additionally, see – UNH Stock To $160? Strategic Transaction Overview The sale to Amphenol represents the culmination of CommScope's systematic portfolio optimization strategy. This transaction comes on the heels of previous divestitures, including the Andrew business and the $2.1 billion sale of outdoor wireless network and distributed antenna systems businesses in the previous year. The divested unit, which designs and manufactures cabling and connectivity products across broadband, enterprise, and wireless networks, comprises a significant portion of CommScope's historical operations. After the transaction, CommScope will keep its access network solutions business and parts of its networking and security services, enabling management to focus resources on these core areas while considerably enhancing the balance sheet structure. Financial Performance Analysis CommScope is showcasing strong revenue growth, with its annual revenue rising by 6% over the last twelve months, from $4.5 billion to $4.8 billion. The company's momentum is particularly observable in its most recent quarter, during which revenue surged by an accelerated 32% to $1.4 billion. This indicates that market demand is strengthening and the company's operational performance is enhancing. After the recent divestiture, the revenue for the remaining company also saw a considerable increase, recording a 58% year-over-year rise to $513 million. The company's profitability profile illustrates a varied picture across different metrics: Operating Performance: Operating income of $593 million results in a moderate 12.4% operating margin, signifying reasonable operational efficiencyCash Generation: Operating cash flow of $103 million translates to a concerning 2.1% OCF margin, highlighting potential working capital challenges or intense capital requirementsNet Profitability: Net income of $748 million produces an impressive 15.6% net margin. CommScope's capital structure reveals considerable financial stress that the divestiture seeks to alleviate: Debt Burden: Total debt of $7.3 billion against a market capitalization of $3.1 billion results in a concerning debt-to-equity ratio of 229%, indicating severe overleveragingLiquidity Position: Cash reserves of $571 million account for 7.3% of total assets ($7.7 billion), providing a moderate liquidity buffer comparable to S&P 500 averages. Valuation Assessment In spite of the recent stock surge, CommScope is trading at attractive valuation multiples that indicate possible undervaluation: Price-to-Sales: 0.7x implies that the market assigns a value of just 70 cents to each dollar of revenuePrice-to-Earnings: 5.6x suggests a low earnings multiple, though debt servicing costs may account for this discountPrice-to-Free Cash Flow: 13.9x signifies a reasonable cash flow valuation given the company's challenges These metrics collectively suggest that the stock 'appears very inexpensive' even after the 86% appreciation, potentially reflecting ongoing market skepticism about execution risks. Investment Verdict and Outlook The Amphenol transaction positions CommScope for potential value generation through debt reduction and operational focus. The proceeds should significantly address the balance sheet issues while allowing management to concentrate on higher-margin network and security solutions. The appealing valuation metrics, combined with improving revenue trends, indicate potential upside for investors willing to navigate the transition period. Of course, we could be mistaken in our evaluation. Despite the positive strategic developments, several risks may influence CommScope's transformation: The success of CommScope's transformation will ultimately hinge on management's execution in reducing debt, enhancing operational efficiency, and strategically positioning itself in its core markets. Investors should carefully weigh these risks prior to investing in the stock. There always exists a substantial risk when investing in a single stock or merely a handful of stocks. Consider the 30-stock Trefis High Quality (HQ) Portfolio, which has a proven track record of consistently outperforming the S&P 500 over the past 4-year period. Why is that? As a group, HQ Portfolio stocks delivered superior returns with less risk compared to the benchmark index; resulting in a more stable ride, as demonstrated in HQ Portfolio performance metrics.
Yahoo
4 days ago
- Business
- Yahoo
Amphenol Strikes $10.5 Billion Deal for CommScope's Connectivity, Cable Solutions Business
Amphenol (APH) agreed to acquire the connectivity and cable solutions business of CommScope (COMM) i Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
