CommScope's play for Arris induced some head-scratching early on, but some analysts are starting to see more upside with respect to the deal's product strategy and bottom-line potential as it approaches the finish line.

Among them, Raymond James analyst Simon Leopold has upgraded his rating on CommScope to a "Strong Buy" -- up from "Outperform" -- under the belief that the earnings accretion from the Arris deal is "underappreciated," and that CommScope will be in good position to profit from the 5G transition.

In a note issued Wednesday, Leopold held that the Arris deal will provide at least 40% accretion in 2020, compared with CommScope's forecast for over 30%, and at the high end of a somewhat wide range from analysts that falls as low as 25% and goes as high as 43%.

Leopold said the wide, variable range on earnings accretion is partly due to an underappreciation that falling memory costs will have a materially positive effect on Arris's profitability.

The big risk is the debt that CommScope is taking on with the deal, though the company believes it can de-lever quickly, forecasting that the combined company will generate about $1 billion in cash flow from operations.

Leopold also believes that CommScope will have a solid play in 5G, which he views as a "freight train, not a bullet; it is slow to leave the station, but may be unstoppable."

Notably, the analyst doesn't buy the argument that CommScope will be at a disadvantage if a sizable number of 5G radios feature integrated antennas that would come from an OEM (original equipment manufacturer) rather than from a third party such as CommScope.

"First, integrated antennas are most likely used with millimeter spectrum known as high band (> 6 GHz), but 5G networks will require an as yet undetermined mix of low-band, mid-band and high-band," he said. "So, not only will the number of antennas increase dramatically, so will the need for the associated cabling and apparatus, which CommScope also sells."

CommScope will also be aided by a partnership with Nokia that will have CommScope integrate its antennas with Nokia radios, he wrote, adding that he expects 5G to aid growth at CommScope in 2020.

Leopold has set a $32 target on CommScope shares, which climbed 89 cents (3.9%) to $23.72 each in Wednesday morning trading.

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— Jeff Baumgartner, Senior Editor, Light Reading