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CommScope (COMM) Completes Home Networks Sale for Core Focus
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CommScope Holding Company, Inc. (COMM - Free Report) recently completed the divestiture of its Home Networks business to Vantiva SA (formerly Technicolor SA) to focus more on its core operations. The company expects the transaction to have no material impact on its adjusted EBITDA on a full-year basis.
Headquartered in Paris, France, Vanita is a leading provider of innovative products and solutions for home entertainment. Post-sale, CommScope will gain a 25% stake in Vantiva. In addition, CommScope will have an opportunity to earn a maximum cumulative amount of $100 million in cash, contingent upon Vantiva achieving an EBITDA equal to or exceeding €400 million in a given fiscal year over the five years following the first full year after closing.
Post-acquisition, CommScope’s Home Networks will form an integral part of Vantiva’s Connected Home division. Notably, CommScope’s Home Networks and Vantiva’s Connected Home generated $1.5 billion and €2 billion in sales, respectively, in the 12 months ended June 2023. The buyout will significantly enhance Vantiva’s geographical footprint, expand its client base and likely generate in excess of €100 million in pre-tax cash synergies driven by cost optimization initiatives and operational efficiencies.
In 2021, CommScope embarked on an initiative dubbed CommScope NEXT — a multi-faceted program to drive future growth that outpaces the market, optimize business processes and unlock shareholder value. As part of this strategy, CommScope intended to separate its Home Networks business to create an independent publicly traded entity.
The tax-free spin-off was aimed to enable both CommScope and Home Networks to drive innovation while enabling the latter to focus more on go-to-market strategy and develop its own technologies for home and consumer products on the back of a resilient manufacturing model. The restructuring would have also provided flexibility to the Home Networks business with a dedicated research & development team that will be responsible for stimulating growth in a “Connected Home” future. With the completion of the divestiture, CommScope has finally been able to realize this vision.
CommScope is focused on sound technology, a highly efficient supply chain and a commitment to continuous improvement. This will likely make the company a preferred partner for all telecommunications businesses as the entire industry moves toward 5G.
With operators moving toward converged or multi-use network structures, combining voice, video and data communications into a single network, CommScope is dedicated to developing solutions designed to support wireline and wireless network convergence, which will be essential for the success of 5G technology. The company’s portfolio of solutions has been specifically designed to help global service providers efficiently deploy fiber networks.
5G technology is likely to be disruptive in nature, with the potential to revolutionize a wide array of industries such as autonomous vehicles, smart cities, remote healthcare, augmented and virtual reality and industrial automation. CommScope’s Mosaic platform will enable mobile operators to integrate passive and active antennas for an economical 5G upgrade. With a flexible design and easy installation facility, it combines a multiband passive antenna with a partner active antenna system for a complete site solution.
The stock has lost 64.1% over the past year compared with the industry’s decline of 45.1%.
Workday Inc. (WDAY - Free Report) , carrying a Zacks Rank #2 (Buy), delivered a trailing four-quarter average earnings surprise of 13.24%. In the last reported quarter, it delivered an earnings surprise of 9.29%. It has a long-term earnings growth expectation of 26.5%.
Workday is a provider of enterprise-level software solutions for financial management and human resource domains. The company’s cloud-based platform combines finance and HR in a single system that makes it easier for organizations to provide analytical insights and decision support.
Qualcomm Incorporated (QCOM - Free Report) , carrying a Zacks Rank #2, delivered an earnings surprise of 2.2%, on average, in the trailing four quarters. It has a long-term earnings growth expectation of 12.5%.
Qualcomm is one of the largest manufacturers of wireless chipsets based on baseband technology. The company is focusing on retaining its leadership in 5G, chipset market and mobile connectivity with several technological achievements and innovative product launches. It is facilitating the seamless transition to super-fast 5G networks, delivering low-power resilient multi-gigabit connectivity with unprecedented range and Qualcomm's best-in-class security. This, in turn, offers the flexibility and scalability needed for broad and fast 5G adoption through accelerated commercialization by OEMs.
Juniper Networks Inc. (JNPR - Free Report) , carrying a Zacks Rank #2, is a leading provider of networking solutions and communication devices. The company develops, designs and sells products that help to build network infrastructure used for services and applications based on single Internet protocol network worldwide. Juniper offers a broad range of routing, switching and security products.
It delivered an earnings surprise of 6.5%, on average, in the trailing four quarters. Juniper has a long-term earnings growth expectation of 9.9%. It has a VGM Score of B.
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CommScope (COMM) Completes Home Networks Sale for Core Focus
CommScope Holding Company, Inc. (COMM - Free Report) recently completed the divestiture of its Home Networks business to Vantiva SA (formerly Technicolor SA) to focus more on its core operations. The company expects the transaction to have no material impact on its adjusted EBITDA on a full-year basis.
Headquartered in Paris, France, Vanita is a leading provider of innovative products and solutions for home entertainment. Post-sale, CommScope will gain a 25% stake in Vantiva. In addition, CommScope will have an opportunity to earn a maximum cumulative amount of $100 million in cash, contingent upon Vantiva achieving an EBITDA equal to or exceeding €400 million in a given fiscal year over the five years following the first full year after closing.
Post-acquisition, CommScope’s Home Networks will form an integral part of Vantiva’s Connected Home division. Notably, CommScope’s Home Networks and Vantiva’s Connected Home generated $1.5 billion and €2 billion in sales, respectively, in the 12 months ended June 2023. The buyout will significantly enhance Vantiva’s geographical footprint, expand its client base and likely generate in excess of €100 million in pre-tax cash synergies driven by cost optimization initiatives and operational efficiencies.
In 2021, CommScope embarked on an initiative dubbed CommScope NEXT — a multi-faceted program to drive future growth that outpaces the market, optimize business processes and unlock shareholder value. As part of this strategy, CommScope intended to separate its Home Networks business to create an independent publicly traded entity.
The tax-free spin-off was aimed to enable both CommScope and Home Networks to drive innovation while enabling the latter to focus more on go-to-market strategy and develop its own technologies for home and consumer products on the back of a resilient manufacturing model. The restructuring would have also provided flexibility to the Home Networks business with a dedicated research & development team that will be responsible for stimulating growth in a “Connected Home” future. With the completion of the divestiture, CommScope has finally been able to realize this vision.
CommScope is focused on sound technology, a highly efficient supply chain and a commitment to continuous improvement. This will likely make the company a preferred partner for all telecommunications businesses as the entire industry moves toward 5G.
With operators moving toward converged or multi-use network structures, combining voice, video and data communications into a single network, CommScope is dedicated to developing solutions designed to support wireline and wireless network convergence, which will be essential for the success of 5G technology. The company’s portfolio of solutions has been specifically designed to help global service providers efficiently deploy fiber networks.
5G technology is likely to be disruptive in nature, with the potential to revolutionize a wide array of industries such as autonomous vehicles, smart cities, remote healthcare, augmented and virtual reality and industrial automation. CommScope’s Mosaic platform will enable mobile operators to integrate passive and active antennas for an economical 5G upgrade. With a flexible design and easy installation facility, it combines a multiband passive antenna with a partner active antenna system for a complete site solution.
The stock has lost 64.1% over the past year compared with the industry’s decline of 45.1%.
Image Source: Zacks Investment Research
CommScope presently has a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Workday Inc. (WDAY - Free Report) , carrying a Zacks Rank #2 (Buy), delivered a trailing four-quarter average earnings surprise of 13.24%. In the last reported quarter, it delivered an earnings surprise of 9.29%. It has a long-term earnings growth expectation of 26.5%.
Workday is a provider of enterprise-level software solutions for financial management and human resource domains. The company’s cloud-based platform combines finance and HR in a single system that makes it easier for organizations to provide analytical insights and decision support.
Qualcomm Incorporated (QCOM - Free Report) , carrying a Zacks Rank #2, delivered an earnings surprise of 2.2%, on average, in the trailing four quarters. It has a long-term earnings growth expectation of 12.5%.
Qualcomm is one of the largest manufacturers of wireless chipsets based on baseband technology. The company is focusing on retaining its leadership in 5G, chipset market and mobile connectivity with several technological achievements and innovative product launches. It is facilitating the seamless transition to super-fast 5G networks, delivering low-power resilient multi-gigabit connectivity with unprecedented range and Qualcomm's best-in-class security. This, in turn, offers the flexibility and scalability needed for broad and fast 5G adoption through accelerated commercialization by OEMs.
Juniper Networks Inc. (JNPR - Free Report) , carrying a Zacks Rank #2, is a leading provider of networking solutions and communication devices. The company develops, designs and sells products that help to build network infrastructure used for services and applications based on single Internet protocol network worldwide. Juniper offers a broad range of routing, switching and security products.
It delivered an earnings surprise of 6.5%, on average, in the trailing four quarters. Juniper has a long-term earnings growth expectation of 9.9%. It has a VGM Score of B.