Darspal S Mann
Long/short equity, growth at reasonable price, special situations, deep value

CommScope Can De-Lever And Deliver

Executive summary:

  1. CommScope (NASDAQ:COMM) has substantial debt on the books and de-leveraging can add value for stockholders.
  2. Cash flow and revenue growth trends are stable enough to achieve deleveraging and maintain the current positive business momentum.
  3. Stock has 30-40% upside as balance sheet restructuring efforts gain momentum and credibility.


A first look at the CommScope Holding Company (COMM) points towards a deteriorating equity with a low ROE, negative tangible book value and expensive debt on the books. The stock looks expensive for a slow growth, low margin connectivity equipment maker.

A closer look highlights the considerable value for shareholders that can be mined by reducing the debt of more than $2.5 billion for a...

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