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Sprint Corporation Message Board

  • lawstuff22 lawstuff22 Feb 11, 2011 10:37 AM Flag

    Morgan Stanley view on S today.

    S.N, Sprint Nextel Corporation ($4.60) /Approaching Opex Pressures Likely
    Push Consensus EBITDA Estimates Lower
    Simon.Flannery@morganstanley.com, Philip.Nanney
    After management’s disclosure around wireline EBITDA declines and Network Vision related
    opex, we believe consensus EBITDA estimates are too high. If we assume an incremental $400m
    in Network Vision related opex and $200m of lost wireline VoIP EBITDA in 2012, Sprint would
    need to offset $600m to grow consolidated EBITDA. Current consensus calls for a $125m Y/Y
    increase in 2012 EBITDA, which seems difficult to us. We gained little new insight into Sprint’s 4G
    plans, though management said it would describe its strategy by mid-year. Network Vision gives
    the carrier flexibility around Clearwire and other 4G strategies, but any change is unlikely to
    impact results near-term. In the mean time AT&T and Verizon will both offer 4G LTE by mid-year,
    posing challenges to continued postpaid adds momentum, in our view.
    Rating: Underweight
    Telecom Services: In-Line
    Target: $3.00
    52-Week Range: $5.31-3.10
    Mkt. Cap(mm): $13,754
    ModelWare EPS: $(1.16) (FY 12/'10),
    $(1.14) (FY 12/'11)

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S
3.6114+0.0814(+2.31%)3:22 PMEDT