10 Most Undervalued Penny Stocks to Buy According to Hedge Funds

4. Commscope Holding Company Inc. (NASDAQ:COMM)

Share Price as of April 18: $3.33

Forward P/E ratio as of April 18: 3.72

Number of Hedge Fund Holders: 32

Commscope Holding Company Inc. (NASDAQ:COMM) provides infrastructure solutions for communications, data centers, and entertainment networks. It operates in three segments: Connectivity & Cable Solutions (CCS), Networking, Intelligent Cellular & Security Solutions (NICS), and Access Network Solutions (ANS).

In 2024, Commscope’s Connectivity and Cable Solutions (CCS) segment improved its full-year revenue by 4.5% year-over-year, which was driven by the expanding data center market. The enterprise fiber business particularly generated $623 million in revenue because of its focus on data center products, and represented 22% of CCS revenue. This was a 73% year-over-year increase. In Q4 alone, the CCS revenue was up 36%, while the enterprise fiber business was up 96%.

Commscope Holding Company Inc. (NASDAQ:COMM) is expanding its production capacity to meet the demand from the data center market, which is projected to grow by over 30% annually. The company is in the middle of a capacity expansion that is expected to add $300 million to its revenue. Commscope also improved its financial position by completing a debt refinancing and selling its OWN and DAS businesses to Amphenol for $2.1 billion, using the proceeds to repay ~$2 billion of debt.