U.S.-traded shares of China Unicom fell Wednesday after a downgrade from a Deutsche Bank analyst who says the mobile phone carrier will need about three years to catch up to its "larger and better regarded competition."

In a note to investors in Asia, Alan Hellawell downgraded the company's shares to "Sell" from "Hold." He said the stock's recent strength comes mainly from a premium it may receive in selling its CDMA network. CDMA, or code division multiple access, is a wireless standard used in the U.S. and South Korea.

Following the transaction, Hellawell expects a "costly game of catch-up investment to prove largely futile cast against (rival China Mobile's) continuing dominance."

China Unicom's American Depositary Shares fell $1.06, or 4.8 percent, to close at $21.11 Wednesday. In the past 52 weeks, the stock has traded between $13.71 and $25.13.