Telecom Signaling Industry News

TMCNet:  The Zacks Analyst Blog Highlights: Sprint Nextel, Clearwire, DISH Network, Verizon Communications and AT&T

[December 19, 2012]

The Zacks Analyst Blog Highlights: Sprint Nextel, Clearwire, DISH Network, Verizon Communications and AT&T

CHICAGO, Dec. 19, 2012 /PRNewswire via COMTEX/ -- announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Sprint Nextel Corp. (NYSE:S), Clearwire Corporation (Nasdaq:CLWR), DISH Network Corp. (Nasdaq:DISH), Verizon Communications Inc. (NYSE:VZ) and AT&T (NYSE:T).

(Logo: Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: id=5513 Here are highlights from Tuesday's Analyst Blog: Sprint Seals Deal with Clearwire Sprint Nextel Corp. (NYSE:S) has finally inked an agreement to acquire the remaining 50% stake in Clearwire Corporation (Nasdaq:CLWR) for $2.97 per share. The total purchase price is estimated at $2.2 billion.

The agreement was approved by Clearwire's board of directors and is subject to regulatory approvals. The deal also requires approval of the majority of Clearwire stakeholders other than Sprint, which already owns 50% of the company's shares. The acquisition is expected to close by mid-2013, subject to regulatory approvals.

If the deal materializes, Sprint will gain full rights over Clearwire. This implies access to Clearwire's radio frequency spectrum ranging 2.5 GHz, utilized in providing services using 4G 802.16e mobile WiMAX standard.

Apart from this deal, Sprint is also trying to forge a partnership with DISH Network Corp. (Nasdaq:DISH) that will enable the latter to offer its own mobile services using Sprint's network. DISH, the second largest satellite TV operator, is waiting for the FCC nod to launch a nationwide high-speed wireless broadband network.

This will enable the company to offer mobile Internet, voice and video services to its customers using its newly acquired satellite airwaves from the bankrupt DBSD North America Inc. and TerreStar Networks Inc.

The agreement, if cleared, would allow Sprint to access DISH Network's spectrum, which is the most important and scarce element in deploying a nationwide super-fast LTE network. Nevertheless, this deal may need an approval from the Japanese wireless service provider Softbank, which has decided to purchase a majority stake in Sprint.

In October, it was reported that Sprint was selling its 70% stake to Japanese cell phone company Softbank Corp. for $20.1 billion.

Sprint is in the midst of a multi-billion dollar restructuring program known as Network Vision. Through this plan, the company is concentrating on the core Sprint platform, which includes CDMA, WiMAX and Long-Term Evolution (LTE) technologies, and the eventual termination of the Nextel platform (iDEN business).

Though the company has enough liquidity to address the growing costs of network upgrade, iPhone subsidies, debt maturities and working capital requirements, it needs to bolster its liquidity position buyouts. The potential transaction would provide Sprint the financial support to build and improve its competitive wireless network.

However, the company is also struggling to deal with the loss of post-paid customers to other industry players such as Verizon Communications Inc. (NYSE:VZ) and AT&T (NYSE:T). This shrink in subscriber base was primarily due to intense price competition, ineffective marketing, less favorable network quality and delay in integration of back-office functions with its acquired units.

We reaffirm our long-term Neutral recommendation on Sprint. However, the stock has a Zacks #2 Rank, implying a short-term (1-3 months) Buy rating.

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About Zacks Equity Research Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: id=5517 About Zacks is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leon Zacks. As a PhD from MIT Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at id=5518.

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