Benzinga | Oct 5, 2021 07:54AM EDT

Credit Suisse Downgrades CommScope - Read Why

* Credit Suisse analyst Sami Bradi downgraded CommScope Holding Co Inc (NASDAQ:COMM) to Neutral from Outperform with a price target of $12, down from $23, implying a 9.3% downside.

* Equipment supply chain constraints that have elongated equipment delivery times have created a dynamic where CommScope may be recognizing solid demand but may fail to ship equipment against those orders, which will limit its revenue recognition and potential, Bradi notes.

* If product shipment delays extend further, the analyst believes there is a scenario where some existing orders cancel, and customers leverage alternative suppliers for existing projects, making Bradi cautious on CommScope's outlook.

* Price Action: COMM shares traded lower by 1.28% at $13.06 in the premarket session on the last check Tuesday.