Stock Alert for Clearwire Corp. (CLWR)
  • Stock Alert for FiberTower Corp. (FTWR)
  • Stock Report for FiberTower Corp. (FTWR)
  • " />

    Stock Alert for Sprint Nextel Corp. (S)

    Sprint Nextel Corp. (S) offers a comprehensive range of wireless and wireline communications services bringing the freedom of mobility to consumers, businesses and government users. It served more than 52 million customers at the end of the second quarter of 2011 and is widely recognized for developing, engineering and deploying innovative technologies, including the first wireless 4G service from a national carrier in the United States; offering industry-leading mobile data services, leading prepaid brands including Virgin Mobile USA, Boost Mobile, and Assurance Wireless; instant national and international push-to-talk capabilities; and a global Tier 1 Internet backbone. The Company operates two reportable segments: Wireless and Wireline.

    Share Statistics (30-Aug-11)

    FY2009 FY2010 % Chg Q22010 Q22011 % Chg
    Symbol S Revenue, $Mn 32.26B 32.56B 0.9% 8.03B 8.31B 3.5%
    Current price $3.59 Gross marg. 49.1% 46.3% -5.7% 47.3% 44.8% -5.3%
    52wk Range: $2.98-$6.45 Oper. margin -1.8% 1.0%
    Avg Vol (3m): 60,926,200 Net margin -7.6% -10.6% 39.5% -9.5% -10.2% 7.4%
    Market Cap. 10.73B
    Shares Outstanding 2.99B EPS, $ -0.65 -1.12 72.3% -0.27 0.28 -203.7%

    Source:, SEC Filings.

    Investment Highlights

    Shares of S have lost 0.28% in the last five days; 15.37% in the last month; and 8.21% year-to-date.

    Shares of the mobile carrier traded as much as 3.72% higher Tuesday on strong volume of nearly 50 million shares.  Wells Fargo analyst Jennifer Fritzsche yesterday reiterated an Outperform rating on shares of Sprint.

    Following checks at Sprint stores, Fritzsche believes the Company has held up fairly well in the third quarter , with stability relative to larger carriers, Verizon Communications (NYSE: VZ) and AT&T (NYSE: T), improving.

    Barron’s Tech Trader Daily blog reported that the analyst acknowledges that the focus of investors is on the Company’s October 7th investor and analyst briefing, when it is expected the Company will address questions regarding how it will build out its 4G wireless network.

    S recently announced its CEO, Dan Hesse, will deliver the keynote address on November 3, during its 11th annual Open Solutions Conference. The Company said developers will learn about its open enablement strategy, creating applications for 4G and 3D, enterprise machine-to-machine (M2M) solutions, go-to-market strategies, approaches to make developers more profitable, and current Sprint tools and capabilities across devices, networks and platforms throughout the three-day conference.

    S shares have been moving within a range of $2.98 – $6.45 over the past 52-weeks.  The stock is currently trading below its 50-day moving average of $4.18 and below its 200-day moving average of $4.78. Market capitalization currently stands at $10.76 billion and it has 2.99 billion outstanding shares.


    Financial Summary

    Sprint reported second quarter consolidated net operating revenues of $8.3 billion, which represented a 4% increase from the comparable quarter last year and remained relatively flat as compared to the first quarter of 2011. The quarterly year-over-year improvement was primarily due to higher postpaid ARPU (average revenue per user), growth in the number of net prepaid subscribers and higher wireless equipment revenues, partially offset by net losses of postpaid subscribers and lower wireline revenues.

    The Company posted an operating income of $79 million and adjusted OIBDA (operating income/(loss) before depreciation and amortization) of $1.3 billion. Additionally, the Company reported a net loss of $847 million and a diluted loss per share of ($0.28) for the quarter, which includes $588 million in equity losses of unconsolidated investments and other ($.20 per share net of tax, which includes the effect of increased valuation allowance of $209 million) and a $52 million charge ($.02 per share, which includes approximately $19 million of related increase in valuation allowance) to tax expense related to recently enacted state law changes in the state of Michigan.

    Capital expenditures, excluding capitalized interest of $102 million, were $640 million in the quarter, compared to $437 million in the second quarter of 2010 and $555 million in the first quarter of 2011. Wireless capital expenditures were $546 million in the second quarter of 2011, compared to $319 million in the second quarter of 2010 and $449 million in the first quarter of 2011. During the quarter, the Company invested primarily in data capacity as a result of increased data usage to maintain a competitive position in data service and overall network quality. Wireline capital expenditures were $35 million in the second quarter of 2011, compared to $49 million in the second quarter of 2010 and $53 million in the first quarter of 2011.

    Sprint generated $267 million of free cash flow in the quarter. As of June 30, 2011, the Company’s total liquidity was $5.2 billion, which consists of $4.3 billion in cash, cash equivalents and short-term investments and $900 million of borrowing capacity available under its revolving bank credit facility. The Company’s next scheduled debt maturities of $2.3 billion are due in March 2012.


    Financial Strength (30-Aug-2011)




    S&P 500

    Quick Ratio (MRQ) 0.93 1.39 1.34 0.74
    Current Ratio (MRQ) 1.06 1.49 1.45 1.09
    LT Debt to Equity (MRQ) 122.15 28.17 37.26 113.34
    Total Debt to Equity (MRQ) 139.08 38.27 47.56 154.01
    Interest Coverage (TTM) -0.47 0.02 0.10 22.82

    Source:, SEC Filings.

    Analyst Consensus

    This is the consensus forecast among 37 polled investment analysts. Against the Sprint Nextel Corp company.

    Analyst Detail






    No Opinion

    Latest 14 7 12 3 1 0
    4 weeks ago 13 7 10 4 3 0
    2 months ago 12 7 11 4 3 0
    3 months ago 12 7 11 4 3 0
    Last year 6 7 13 5 0 0

    The 30 analysts offering 12-month price targets for S have a median target of 5.50, with a high estimate of 12.60 and a low estimate of 3.00. The median estimate represents a 58.96% increase from the last price of 3.46.


    Consensus Estimates Analysis

    # of Estimates




    1 Year Ago

    SALES (in millions)
    Quarter Ending Sep-11 25 8,364.10 8,483.00 8,071.00 8,003.81
    Quarter Ending Dec-11 25 8,461.67 8,676.57 8,088.00 8,033.36
    Year Ending Dec-11 32 33,475.00 33,824.00 32,347.90 32,056.40
    Year Ending Dec-12 32 34,228.10 35,175.00 32,822.20 32,212.20
    EARNINGS (per share)
    Quarter Ending Sep-11 29 -0.21 -0.14 -0.37 -0.14
    Quarter Ending Dec-11 29 -0.22 -0.14 -0.34 -0.14
    Year Ending Dec-11 31 -0.82 -0.46 -1.12 -0.66
    Year Ending Dec-12 32 -0.67 -0.22 -1.39 -0.32
    LT Growth Rate (%) 4 -44.05 6.00 -184.00 1.40

    Technical Analysis


    S is within its Bollinger Bands. This is a normal condition suggesting that it is neither overbought nor oversold relative to the recent levels.

    S’s MACD is currently indicating a weak bullish signal. Although the MACD is trending above the signal line, the indicator is still below 0, which suggests that the underlying moving averages are bearish.

    Comparative Analysis

    Company Name Ticker Price per Mrkt. Cap. P/E P/S
    Aug00-2011 symbol Share, $ $ Mn 2011 2012 2011 2012
    Leap Wireless International Inc. LEAP 9.12 717.71M n/a n/a 0.23 0.22
    MetroPCS Communications Inc. PCS 11.11 4.02B n/a n/a 0.82 0.75
    Verizon Communications Inc. VZ 36.34 102.86B n/a n/a 0.93 0.89
    AT&T Inc. T 29.67 175.82B n/a n/a 1.39 1.38
    Wireless Communications Median       13.07 n/a 1.11 n/a
    Sprint Nextel Corp. S 3.60 10.78B n/a n/a 0.32 0.32

    Source: Thomson Financial

    DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS REPORT. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority.  We are neither licensed nor qualified to provide investment advice.

    The information contained in our report should be viewed as commercial advertisement and is not intended to be investment advice.  The report is not provided to any particular individual with a view toward their individual circumstances. The information contained in our report is not an offer to buy or sell securities.  We distribute opinions, comments and information free of charge exclusively to individuals who wish to receive them.

    Our newsletter and website have been prepared for informational purposes only and are not intended to be used as a complete source of information on any particular company.  An individual should never invest in the securities of any of the companies profiled based solely on information contained in our report.  Individuals should assume that all information contained in the report about profiled companies is not trustworthy unless verified by their own independent research.

    Any individual who chooses to invest in any securities should do so with caution.  Investing in securities is speculative and carries a high degree of risk; you may lose some or all of the money that is invested.  Always research your own investments and consult with a registered investment advisor or licensed stock broker before investing.

    Information contained in our report will contain “forward looking statements” as defined under Section 27A of the Securities Act of 1933 and Section 21B of the Securities Exchange Act of 1934.  Subscribers are cautioned not to place undue reliance upon these forward looking statements.  These forward looking statements are subject to a number of known and unknown risks and uncertainties outside of our control that could cause actual operations or results to differ materially from those anticipated.  Factors that could affect performance include, but are not limited to, those factors that are discussed in each profiled company’s most recent reports or registration statements filed with the SEC.  You should consider these factors in evaluating the forward looking statements included in the report and not place undue reliance upon such statements.

    We are committed to providing factual information on the companies that are profiled.  However, we do not provide any assurance as to the accuracy or completeness of the information provided, including information regarding a profiled company’s plans or ability to effect any planned or proposed actions.  We have no first-hand knowledge of any profiled company’s operations and therefore cannot comment on their capabilities, intent, resources, nor experience and we make no attempt to do so.  Statistical information, dollar amounts, and market size data was provided by the subject company and related sources which we believe to be reliable.

    To the fullest extent of the law, we will not be liable to any person or entity for the quality, accuracy, completeness, reliability, or timeliness of the information provided in the report, or for any direct, indirect, consequential, incidental, special or punitive damages that may arise out of the use of information we provide to any person or entity (including, but not limited to, lost profits, loss of opportunities, trading losses, and damages that may result from any inaccuracy or incompleteness of this information).

    We encourage you to invest carefully and read investment information available at the websites of the SEC at and FINRA at

    Leave a Reply

    Your email address will not be published. Required fields are marked *