Stock Alert for Clearwire Corp. (CLWR)
  • Stock Alert for Clearwire Corp. (CLWR)
  • Stock Alert for Clearwire Corp. (CLWR)
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    Stock Alert for Clearwire Corp. (CLWR)

    Clearwire Corp. (CLWR), through its operating subsidiaries, is a provider of mobile broadband services. Its 4G network currently provides coverage in areas of the U.S. where more than 130 million people live. The Company’s open all-IP network, combined with significant spectrum holdings, provides an unprecedented combination of speed and mobility to deliver next generation broadband access. CLWR markets its 4G service through its own brand called CLEAR® as well as through its wholesale relationships with companies such as Sprint, Comcast, Time Warner Cable, Locus Telecommunications, Cbeyond, Mitel, NetZero and Best Buy. Its strategic investors include Intel Capital, Comcast, Sprint, Google, Time Warner Cable and Bright House Networks.

    Share Statistics (04-Nov-11)   FY












    Symbol CLWR Revenue, $Mn 274.46 556.83 102.9% 236.81 322.61 36.2%
    Current price $1.89 Gross marg. -56.1% -66.6% 18.7% 1.4% -34.3% -2550.0%
    52wk Range: $1.24-$7.37 Oper. margin -397.8% -282.6%
    Avg Vol (3m): 8,128,460 Net margin -118.6% -87.5% -26.2% -95.8% -52.3% -45.4%
    Market Cap. 469.67M              
    Shares Outstanding 248.50M EPS, $ -1.69 -1.63 -3.6% -0.43 0.34 -179.1%

    Source:, SEC Filings.

    Investment Highlights

    CLWR shares spiked as much as 29% on Friday on news that telecom giant Sprint Nextel Corp. (NYSE: S) intends to offer debt in a private transaction and could use the proceeds to help finance the wireless carrier.

    Shares in CLWR have lost 5.5% in the last five days; 12.1% in the last month; and 73.6% year-to-date.

    Sprint Nextel is CLWR’s majority stakeholder, as well as its biggest customer. CLWR shares were hammered down last month after Sprint revealed plans for adding 4G services using the LTE standard, which observers saw as a move that the latter is distancing itself from CLWR. CLWR argued that the telecom giant remains dependent on CLWR for 4G and nothing about the Sprint’s move changes that.

    CLWR last week announced its financial and operating results for the third quarter of 2011.

    The Company reported revenue of $332.2 million, representing increase of 134% from the comparable quarter last year.  Retail revenue and other revenue for the quarter was $195.0 million, a year-over-year increase of 55% from $125.6 million in third quarter 2010. Retail average revenue per user (ARPU) came in at $47.05, up from $43.10 in third quarter 2010.

    Adjusted EBITDA in third quarter 2011 was a loss of $46.4 million, representing a sequential improvement of $62.1 million when compared to second quarter 2011 pro forma Adjusted EBITDA loss of $108.5 million. When compared to second quarter 2011 actual Adjusted EBITDA loss of $79.6 million, Adjusted EBITDA for the latest quarter improved by $33.2 million.

    CLWR recorded a net loss from continuing operations attributable to the Company of $83.5 million, or $0.34 per basic share. Including the effects of discontinued operations, the net loss attributable to the Company was $84.8 million, or $0.35 per basic share.

    At the end of third quarter, CLWR said operated networks in the U.S. covering areas where approximately 135 million people reside, including approximately 133 million people in 4G markets in the U.S.

    Looking forward, CLWR now expects to exceed its previous guidance of 10 million subscribers by the end of the year, with most of the new subs      cribers coming from its wholesale business. Before any impact of an LTE deployment, the Company now expects capital expenditures in 2011 to be less than $300 million, about $100 million lower than previous guidance.


    Financial Strength (04-Nov-11)




    S&P 500

    Quick Ratio (MRQ) 1.78 1.50 1.41 0.60
    Current Ratio (MRQ) 1.80 1.63 1.53 0.93
    LT Debt to Equity (MRQ) 460.37 39.49 44.79 98.06
    Total Debt to Equity (MRQ) 460.37 48.25 54.47 138.26
    Interest Coverage (TTM) -19.45 0.02 0.11 20.70

    Source:, SEC Filings.

    Technical Analysis



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

    CLWR’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
    Nov04-2011 symbol Share, $ $ Mn 2011 2012 2011 2012
    CenturyLink Inc. CTL 36.23 21.79B 22.36 20.59 1.17 1.20
    Verizon Communications Inc. VZ 37.17 105.23B 16.90 14.52 0.95 0.91
    Wireless Communications Median       13.14 n/a 1.06 n/a
    Clearwire Corp. CLWR 1.89 469.67M n/a n/a 0.38 0.28

    Source: Thomson Financial

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