COMM vs. APH: Which Communications Stock is a Better Buy Right Now?

CommScope Holding Company, Inc. COMM and Amphenol Corporation APH are major players in the communication infrastructure industry. CommScope is a premier provider of infrastructure solutions, including wireless and fiber optic solutions, for the core, access and edge layers of communication networks. The company has created a niche market for itself, helping customers scale network capacity, delivering better network response time and performance, and simplifying technology migration.

Amphenol is a major designer, manufacturer and markets electrical, electronic and fiber optic connectors, interconnect systems, antennas, sensors and sensor-based products and coaxial and high-speed specialty cable. Its vertically integrated manufacturing facilities enable it to streamline operations and allow it to maintain greater control over cost and quality.

With a strong focus on innovation, both CommScope and Amphenol are steadily advancing their portfolio strength to gain a firmer footing in the highly competitive communication infrastructure market. Let us delve a little deeper into the companies’ competitive dynamics to understand which of the two is relatively better placed in the industry.

The Case for Amphenol

Amphenol’s strength lies in strong emphasis on innovation. The company boasts a comprehensive patent portfolio catering to a wide range of technologies, including mechanical, electrical, radio frequency, optical and electronic features of interconnect, antenna and sensor products. The company’s design teams closely work with customers to develop tailored research and development strategies. Its virtually integrated manufacturing strategy enables it to quickly adapt and implement the suggested changes. Such strong responsiveness to market dynamics is major positive. 

Moreover, the company’s manufacturing and assembling facilities are located in several countries worldwide. The company is steadily expanding its presence and placing the manufacturing hubs near its customer locations. This strategy is allowing the company to mitigate the effects of supply chain issues, improve understanding about regional markets, and lower production and logistics costs. Amid growing geopolitical unrest worldwide, this approach makes Amphenol more reliable to its vast customer base.

In the communication solution segment, the company serves a wide range of end markets, including automotive, broadband communications, commercial aerospace, defense, industrial, IT and data communications. Along with technological advancements, the company is actively pursuing to diversify its customer base and product offerings. Its diversified business model reduces its vulnerability to downturn in any single sector, increasing the reliability of the company’s earnings and revenues, thereby driving returns for investors in the long haul. 

Amphenol’s acquisition strategy has significantly strengthened its position in the industry over the past few years. The company recently completed acquisition of CommScope’s Outdoor Wireless Networks (OWN) and Distributed Antenna Systems (DAS) businesses, significantly strengthening its position in the communications network market. As of first-quarter 2025, its debt to cap ratio was 40.9%, while its times interest earned was 14. With strong liquidity and healthy cash flow generation, the company is well-positioned to invest in growth initiatives, conduct strategic acquisitions and pay off debt.

However, the company has a major presence worldwide. Although it offers some major strategic benefits, the current U.S. Govt tariff policy can significantly impact its business. Particularly, it has a presence in China. Growing trade-related uncertainty between the United States and China remains a concern. The company is facing competition from CommScope, TE Connectivity, Delphi, Sensata and more which impact margin.

The Case for CommScope

Understanding market trends and developing strong customer relationships are helping CommScope build tailored data and video networking solutions. It is steadily expanding its market presence with service providers outside of North America. The company is effectively identifying underpenetrated metropolitan areas to expand Enterprise sales coverage. It has a broad customer base worldwide. Enterprises like Charter Communications, Inc., Comcast Corporation, Cox Communications, Rogers Communication Inc., National Broadband Network Company Limited and more rely on COMM’s product suite to advance their network infrastructure. 

COMM's comprehensive and differentiated portfolio is allowing to further expand its customer base. Orange Belgium, a leading telecom operator in Belgium offering voice, video, and data services, has opted to deploy CommScope’s Video Unified Edge platform to support its Distributed Access Architecture (DAA) network. Wyre, a joint venture between Telenet and Fluvius, has selected CommScope’s cloud-native vCCAP Evo solution. By combining it with CommScope DAA solutions, Wyre intends to offer high-speed, low-latency data, video and voice services. As the region moves to upgrade digital infrastructure by developing scalable networks, CommScope is emerging as a key enabler in that initiative. These strategic collaborations indicate CommScope’s growing prowess in the communication infrastructure space.

However, a challenging macroeconomic environment is affecting the spending decision of telecom operators, hindering the growth opportunity for CommScope. The company is facing intense competition from industry giants like Amphenol Corporation and Corning Incorporated GLW in the Connectivity and Cable Solutions business. Corning’s portfolio of optical fiber, hardware, cables and connectors is gaining momentum in broadband and 5G markets. The growing adoption of innovative optical connectivity products for generative AI applications is driving growth in Corning’s optical communication segment. It is also facing competition from several small and medium-sized companies at a regional level.

As of March 31, 2025, the company had $493.3 million in cash and cash equivalents with $7.24 billion in long-term debt. As of first-quarter 2025, its debt-to-capital ratio stands at 154.3%, while its times interest earned at 0.7. Despite efforts to optimize its business structure through divestiture, its weak liquidity position will likely undermine investment in new initiatives.

How Do Zacks Estimates Compare for APH & COMM?

The Zacks Consensus Estimate for Amphenol’s 2025 sales implies year-over-year growth of 32.33%, while that of EPS is projected to grow 40.74% year over year. The EPS estimates for 2025 have improved 14.66% over the past 60 days, while the estimate for 2026 has improved 11.49%.

The Zacks Consensus Estimate for CommScope’s 2025 sales implies year-over-year growth of 3.46% while EPS is projected at 90 cents per share against a loss of 3 cents a year ago. The EPS estimate for 2025 has improved 11.11% over the past 60 days while the estimate for 2026 has improved 0.88% during the same period.

Price Performance & Valuation of APH & COMM

Over the past year, CommScope has gained 387.2%. Amphenol has gained 27.7% over the same period.

CommScope looks more attractive than Amphenol from a valuation standpoint. Going by the price/sales ratio, CommScope’s shares currently trade at 0.24 forward sales, significantly lower than Amphenol’s 5.01.

APH or COMM: Which is a Better Pick?

Amphenol sports a Zacks Rank #1 (Strong Buy), while CommScope has a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

CommScope is taking several initiatives to optimize its portfolio, improve its liquidity through strategic divestiture. However, high debt burden is impacting its investment in innovation and making it more vulnerable to intensifying competition and macroeconomic volatility. Amphenol’s strong balance sheet, healthy cash flow generation and impressive growth in revenues and profit in recent years underscore the strength in its diverse business model. Hence, with a superior Zacks Rank, Amphenol appears to be a better investment option at the moment.

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This article originally published on Zacks Investment Research (zacks.com).

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