The Sprint brand is suffering.
Subscribers are leaving.
Being downgraded since merger completion.
The management team has mostly remained in tact. (Except for their Chief Sales Officer)
And Son continues to buy more shares.
I give him credit as he could very well be the smartest man in the room buying everyones shares at these levels, but it's one heck of a gamble (Over $25 B now) that we won't know the outcome for a few years.
Shas bought 80% of Sprint for $25 billion. That is for a company that once priced the Nextel acquisition at $35 billion and sustained losses, and which had a mobile business value at a combined $60-$70 billion. For the $25 billion, Softbank acquired a mobile business, a broadband business, and the potential for future TV/media and vertical market expansion. In the bargain, Softbank acquired combined spectrum of Sprint and CW plus additional spectrum acquired over the last few years.
Historically the acquisition looks like a real bargain. The once lofty value of Sprint plus the acquired assets of Clearwire and some additional spectrum had become discounted to a mere $25 billion. So the broad question is whether the huge discounting in mobile operation and assets will continue into the future or whether Sprint – SB can reverse the trend to achieve better margins and profitability that would reflect in higher stock price. In the broad picture, questions to ask are whether overall business will expand or contract. While it may seem ludicrous to suggest ITC business that Sprint can participate in will contract, it's quite possible if competition centers around price to the exclusion of extended markets and value creation.
In the current climate we see greater price competition. This is being buffered by programs that attempt to lock in subscribers, namely device upgrade programs. While this tends to lock in subscribers, the market has already become saturated, thus leading to this fight to hold and try to cover away competitors subscribers. For the most part this is precisely what the DOJ and FCC would like to see occur; greater competition that forces innovation in network operation, devices and services. Competition should become more base on value creation rather than marketshare dominance.
Son paid $7.65 for most of S. Now he's buying more S for less than what he paid before. Warren Buffet does the same thing, when he buys a stock based on fundamentals and Graham levels, he determines an entry point, and starts buying. If the price goes down, then he buys even more, and he's happy everyone else is a bunch of jerks, who can't see real value, when it is staring them in the face.