Why 6? There is nothing magical about 6. Sprint's long-term objective must be to push strongly into profits, up-ending the multiple year folly of running a business to milk the tit of the industry massive trajectory of money flows that resulted in sustained loses. There have been many at Sprint who fully understood this likelihood.. even if inane to the reasoning. The course of business (money) management had resulted in Sprint going down the path only middle management muck ups in tow of senior management brain-deads could possibly have concocted.
Why not $1 or less?
In the absence of a monumental recalculation of the physics of the converged mobile business, Sprint will become even more of an oxygen sucking vacuum than had led Sprint into the 'saviour of last hope' arms of Masa Son.
Translation: We talk jive to pump the stock to make mo' money. Whether Masa Son is a genius is irrelevant.. stocks are based on financial performance, not hero worship.
The history of Sprint claims that new sales and advertising programs, store conversions, direct retail home visits, new devices, lease programs, etc. will cause a major shift in sales shows not to count the chickens before the eggs hatch. The introduction of the new iPhone has been anticipated. The news that sales are ahead of last time should come as no surprise because both Sprint and T-Mobile have returned to subsidizing what will likely be the hottest device introduction over a 2+ year period. Even before any details of S's or TM's plans were announced, it was highly expected for them to pull out all stops to snag customers. The logic of that goes like this: The rate of churn in the industry has been trending down. In layman's terms, that means subscribers are changing carriers less often than in years past. That, in turn, is due to devices and service becoming much more mature. Users are holding onto to devices much longer than years ago because there is not enough improvement to ditch out for a new device.
So, Sprint and T-Mobile are giving away new iPhones in return for a returned device and long-term contract. This is not a 'free' way to win much needed business but is 1) the best shot at grabbing marketshare away from iPhone market leaders Verizon and AT&T, and 2) Made less costly by the ability to sell refurbished older models, recouping as much as half the cost of a new phone.
Does it make sense for investors to get caught up in the hype of marketing campaigns? Only so much as the results bare out. The fact is that less than 20% of Sprint's device sales come from Apple devices. The turnover of those devices has been stretching out - users holding onto them longer. The iPhone 7/Plus should cause a bump in upgrades and, Sprint and T-M hope, an influx of new subscribers gained from Verizon and AT&T. The problem is that the immediate impact of an influx of those customers is not a surge in profits. Instead it is aimed at long-term share gains.
Significance: Sprint has historically had a high level of short selling due to both hedging of its high junk bond debt level and sustained financial losses. The level of SI has been over 100 million shares during most of the past 20 years. The number has tended to move up as the stock went up, lower as the price drifted lower. In the past, this was a highly correlated indicator of the general direction the stock would take over the following months. Then about 20 months ago Short Interest continued to move and stay high even as the stock price moved down to the 2-3 dollar level. That was likely because repayments of several billion dollars of junk bonds was set to come due in the second half of 2016 and following years. That put Sprint into a position of facing debt repayment while the company continued to report quarterly losses. Softbank responded by setting up specialized companies that exchange assets and secured cash flows for capital that is earmarked for debt repayment. That means Sprit holds off the prospect for default on debt and, thus, bankruptcy or court managed debt restructuring (it could be construed as not being an outright bankruptcy).
Sprint is among the behemoth players in the highly regulated, massively financed mobile industry that do not face rapid shifts in their financial standing.. for good or for worse. As such, the short interest serves as a barometer the shifts higher or lower depending on whether Sprint stands on solid ground or quicksand at the moment.
By going after the big kahuna issue of debt repayment, Softbank has bought time and eased concerns of the debt holders. That pleases the investment bankers/Wall Street and makes S less a target for short selling.
As the new financial instruments have come into play as described above, SI has shifted down even as the stock price moved from around 3 to 7. I
You are confusing the near-term movement of the stock price with hte fundamentals and long-term prospects for the company. Short-term investors ride trends up and down, but only the worst idiots among us confuse that or other short-term issues with a pegging of a love-hate relationship. If you work for Sprint, then you probably have some allegiance that disregards a tallying of facts. If, on the other hand, you are an investor, then you should call it like it is and trade or long-term invest base on facts, not management's or the PR department's ability to sugar-coat reality. I've posted that Sprint (S) is not gaining financial or competitive ground in the field. However, I've also said to ride momentum up for as long as it takes you... using program trading if you can to buy and sell to take advantage of the moves.
"Brah haha! You must love or hate a stock because we are simple-minded idiots who must choose sides".. LOL!
Sprint has turned into more a drag than a foundation of Softbank's business and future prospects. SB's 'foundation' companies are those that are most valuable and spin out the most profits. Sprint (S) continues to consume capital and will not be able to spin out capital to afford Softbank moving on to new growth industries for up to five yeas, if ever. Softbank has sold off gaming and eCommerce , among the fastest growth industries for strategic reasons and in order to defray Sprint's continued capital requirements.
How much is Sprint a 'foundation' of Softbank's conglomerate business? About as much as Masa Son's repeated statements that he wants to sell it but has received no worthwhile interest. EWven recalcitrant ANALysts can understand that.
I said "glib ANALyst comments vacant of trajectory change level facts to support it is limited to brainless niceties." That is misplaced: the ANALysts who are most bullish do have brains. They somehow cloud their thinking with immediate objectives of picking trends in momentum or in prejudices borne by working in an industry attuned to the relationship between pimps and sex workers but it was inappropriate for me to blame them for being brainless. Sorry.
LOL! Get real. Verizon is playing defense from a much stronger market, capital structure, and overall business perspective. Sprint hired their ex-spokesperson and used him in a provocative way indicative of an underdog. Juding by the media attention and social media response, Sprint's campaign is a success. However, saying that this is a 'success' is perfunctory: it has apparently been good at gaining attention but what results from that attention is taken as only one new input in a very clouded situation. The real success of the campaign would be that it results in gains of subscribers, markedly, taking share away from Verizon that is of a magnitude that is not just another momentary blip on the screen of public impression. Sprint needs to gain millions of subscribers. All the whitewash and glib ANALyst comments vacant of trajectory change level facts to support it is limited to brainless niceties.
Would, coulda, shoulda... requires ball-busting facts.
LOL! I know how network technologies and spectrum works well enough to know how these reports would evolve and why the averages you newbie idiots understand would not translate into higher numbers of subscribers. The reports show averages for the bandwidth of service that is stupid and misconstrued by idiots at Sprint and elsewhere either out of ignorance or, more likely, in an attempt to delude the public including your fellow dumbfartitises among investors. While the averages show great improvement in service levels, the subscriber number prove what I have been saying over the past 15 years including more recently about what customers would decide: customers would need their service to be good, not a statistical average to be good/improved.
However, I have also said to let the results speak for themselves: If Sprint's methods could improve their network so that it was attractive to more people, then that should show up in the results. If not, then that or some mysterious reason nobody has explained is the cause.
Go ahead, hoopla it up. If you cannot figure out why averages do not result in growth in sales and subscriber counts, then do not blame me. Investments need growth, not "average network speed improved more than anyone else's". The bottom line that accountants and analysts are interested in do not give a #$%$. Unless there is an order of magnitude improvement in those numbers compared to the past three-quarters, Sprint common stock is road kill.
4. The over-dependence on 2.5GHz leads to exactly what was shown in presentation slides starting with Sprint's Gary Forsee and the way 'New Clearwire' organized pursuit of network and leading up to Sprint CEO Hesse and, then, onto Masa Son and Claure: The 2.5GHz provides wide channels that can deliver very high (for this time) bandwidth in peak coverage zones. However, because of the range and building penetration limitations of high-frequency spectrum, unless 'massively smallcell' approach is pervasive, this results in what Sprint is able to realistically achieve with the limited capital available: 15-25% of overall national coverage having higher than competitors bandwidth while 40-60% of the rest of the country has much lower than competitor's high bandwidth. In many areas, Sprint's coverage cannot be called 'high bandwidth' because it falls into current definitions of 'low bandwidth' - under 700kbps - and spotty/inconsistent.
Why the average bandwidth fails:
Saying Sprint has improved more than competitors is both true and a mistake. It is true because Sprint has rolled out higher width bands using distance-limited 2.5Ghz. That provides peak areas.. the lumps in the gravy. While that makes the average bandwidth much improved over the past, Sprint's overall number lags as competitors have improved off of a higher mean.
If the averages reflected the whole story, Sprint would have been gaining subscribers by the millions - consumers may be slow on the uptake but they are human, seeking out stuff that is a good value. Don't you think there is a reason why Sprint has not grown marketshare? Yep, its because the average must work for each consumer who bases what they buy on not just low price but their own coverage and bandwidth. The person living three blocks from a tri-band cell tower can get super service. The poor slob who is outside of major coverage areas won't buy being smoothed into the averages.
"We have a failure to communicate". Grok.
Sprint's decade's persistent problem is 'top-down thinking' of how to solve its financial, network structure, and relationship with consumers. Networks are the foundation upon which mobile service is built. However, it is determined by engineering and corporate management that makes foundational decisions in how to deploy capital to pursue long-range plans to acquire spectrum, deploy network infrastructure, and interact/use markets. The all-encompassing term 'markets' must start with an understanding of individual users and then 'aggregate upward' into the (overly) simplistic molding of markets through the use of advertising and other aspects of marketing that are directed at the bulk or large segments of consumers. If you fail to build the plumbing right for so long that you have already mortgaged your home to pay for prior improvements, then there is nothing left to make major fixes unless it is figured out how to do so vastly more efficiently than competitors. Sprint must either find new catalysts for building (circumstantial parts of) the network and partake in viral forms of marketing or the company is merely a 'Zombie company'... it is already dead but too brain-dead on its part to know it. Sprint is a victim of being part of 'what brung it (sic)'.. contrained/molded in the past.
The problem with Sprint's network:
1. It is more costly than competitors.
2. Sprint has extremely limited financial resources and lacks the means for the development of marketing or deployment momentums to make meaningful changes in the status quo.
3. Sprint's network has over-dependence on a single band of spectrum - Band 41 2.5-2.6GHz. Competition dictates a mix of low-mid-high band spectrum is needed to compete on a cost and user satisfaction basis. This is true for both satisfying current market needs for seamless voice and messaging and for bringing out more high-bandwidth services.
4. The over-dependence on 2.5GHz con't
S shows a trisecting gulverfarben oscillator curve with a tophat wafer bank formation. This is highly predictive. The next move will be similar to that seen when former CEO went fishing in Alaska. The price target for Sprint (S) is somewhere around 1.40 to 8.275 give or take three femptoklavens.
Sprint (S) now looks extremely overbought based on both the technical and fundamental analysis since the stock jockeyed up to near 11,50 after Softbank acquired the beleaguered public company. I said S was overbought near 5 but to let the momentum dictate when to exit positions or go short. Now that the stock has risen over 6, it looks closer to a tipping point.
ADX, MACD, Stochastics look bearish while Acum/Distr. look bullish. Chart pattern looks short-term overextended/bearish.
Analysts consensus target price has moved up from 3.5 to 5 since the stock has moved up to the current level. March 2017 fiscal year earnings have increased from a loss of 31c to a loss of 24c per share. Sprint is shown to have a P/E of -25.9 against the industry average of +9.2 by Zacks. Since the earnings release, more earnings revisions have been up than down by 8:3.
Sprint longs have been rewarded with a large increase in the stock price. Besides the technicals looking overextended, I think the stock has moved up beyond the scope of recent improvements in prior expectations that had moved lower over the preceding two years. The bottom line remains lower sales and continued losses with swaps of assets for debt repayment funding. That has come across as a breath of life-giving air to heretofore dying patient. However, S remains on life support.
In the first place, this is a stock board, not a mobile service complaint board. Operators have/ will likely continue to have periodic and spot network problems that upset users. Mobile service is not a new thing - consumers should be aware that every operator has weaknesses and strengths and that buying a service is a trade off between what it costs and the service quality in the areas they use it. Therefore, it makes sense to talk to friends/family and associates, check out the independent and operator's network coverage mapping sites, and do a trial. If you buy a service that offers a trial period, pay close attention to the details (fine print) in the contract. Specifically, where/how, and how far in advance the service must be cancelled. If the plan includes a device, there may be return requirements and penalties imposed.
In the second place, don't be a rube: complain about your individual service or device issues on an appropriate site.
Overall, T-Mobile has gained the highest ranking in recent consumer surveys. And TM has received the #2 ranking for network coverage and #1 ranking for network speed. Despite those rankings, consumers should figure out how good the service is in their location(s).
What matters is based on the average user experience, not anyone or group or area. Do what if what you say is true and TM's service sucks to bloody hello in your area? So long as the average fellow muck is getting competitive coverage and speed so that more people are joining T-Mobile than competitors, it adds up to a positive for investors, the people who are supposedly the ones reading stuff here.
Why follow Cramer all of a sudden? Ans. Because he agrees with you.
Is Cramer good at picking stocks? Two graduate level studies done on Jim Cramer's stock picks show that they tend to go up by 1-3% on average for a few days following his picks on TV. However, the majority of bullish picks are on stocks that have already moved up. That is the lamest ANALysts ploy in the financial industry - pick winners after they are already charging ahead. That is fine, picking stocks can be to pick stoccks that already have established a trend.. the odds generally improve. But some stock pickers, pundits, and ANALysts make their picks when many of the stocks are reaching a zenith rather than in the start or middle of the trend.
How well did Cramer#$%$ do a few months after he announced them? The majority were flat to down with the average being down about 4% which is more than the short-term upside potential. Some traders have gotten Cramer#$%$ immediately before airing of his show in order to place buys and sells. That could work according to the studies.
Sprint (S) looks extremely short-term overbought and is a sell/take profits or short candidate. The short interest in Sprint has been trending down, largely, IMO, because debt hedging has decreased, not because the investment is correspondingly favorable. However, SI may continue to moderate lower as Sprint raises the funds to pay back debt maturities over the next 18 months. I think S has reached a price level where short interest is less likely to drop to the same degree seen recently.
Wall Street loves money. They would love to load Sprint up with more high-interest yield debt until it pukes up blood... so long as they get paid.
Moody's lowered the default risk rating on Sprint's debt. And Sprint will soon use cash obtained from loans-lease arrangements to pay off maturities due this year and next. With S's corporate rating at Baa3, Sprint would still have to pay high interest if they succumb to borrowing more via Wall Street despite the fact that interest rates are lower now than when the bulk of S's bonds were written.
The picture is Sprint is treading water - staying in the same place but tiring. The loans from Softbank require the pledging of debt-survivable core assets. Land, the ability to make enough profits to stand on solid ground, is still more than 2 years (2 miles) in the distance. For Sprint to survive in its current state/financial structure, it will need a burst of energy that its depleted body does not have in reserve.
If you cannot beat competitors at the same game, what do you do? Die or change the rules of the game (if that is possible which looks very unlikely).
Short interest is a reflection of Sprint's overall risk. That has moderated as is reflected in two macro type factors/indicators: Softbank has arranged loans in the form of credit facilities that exchange device cash flows and network and spectrum assets for loans needed by Sprint to pay down maturing debt. The looming debt repayments have been the biggest threat to Sprint's financial survival. The new lend-lease arrangements do nothing whatsoever to reduce debt to equity. However, since it does afford the payment of the near-term debt, it reduces the risk of financial collapse and debt restructuring.
Keep the thinking as simple as it is: less risk of financial collapse, less opportunity for shorting at sub $5 price level. Large block short sales usually are placed for longer-term positions.
Think of the creative financial arrangements as swapping the ball from one cup to another.. the elements are the same only shift from hand to hand. Total debt is not materially changed. The cost of debt is about the same.
Then look at this week's Moody's rating revisions: The debt vehicle and overall ratings remained the same but the short-term default risk factor was improved. M is saying "Improvement for debtors, same 'ol for corporate position and shareholders."
You sound irritated. Your mommy has a fresh diaper ready to paste on your tucas... so drop trow.
I am not 'shorty'.. if a stock has better odds of moving up or down you pick sides based on that, not on some moronic bias. Those who followed what I wrote would have been influenced to be buyers when S reached oversold and held onto the position(s) for as long as the momentum following program trading orders were not triggered. In which case, they would have banked profits from the move off the 2.10 level. Even as the TA bias turns bearish the call is to sell when the stock moves lower, not before. On the other hand, Sprint (S) has spent most of the time moving lower over the past 20 years. Over that time, this board has always had 'perpetual longs' calling for investors to 'trust me, buy and hold, this is going to xx!'. I do not ask anyone to 'trust me'. Trust results and your own ability to learn how to invest using whatever timeframe and strategy that makes sense to you. Anyone who perpetually advocates on one side of the trade is a nut IMO. Investing is a game of continuous assessment of the odds of one stock, option, fund, or pulling out of the stock market over the other.
You must think investing is like religion - you make a decision to believe in the sticker symbol and anyone who disagrees is not just wrong but will not be heard. Sorry, that is not how markets work.
You say I am the moron? Why don't you discuss the post rather than go after me personally? Because you can't.
Get to the points mentioned: There are more of the leading financial analysts coming into agreement on what would be needed for Sprint to turnaround. Do you have rigorous analysis to show how Sprint can pull out of its swoon lower in competitive ranks and loss of shareholder value at the current and projected rate of subscriber gains? If you do not, then why are you posting on the subject at all unless it is to divert attention away from the important issue? Do you really care where Sprint (S) is heading or are you trying to cover up the facts in order to pull in suckers to bail out your position?
What is the financial formula for gains in subscribers and profit generation? How much does it cost Sprint to acquire new customers?
Why did Claure say that Sprint would like to get away from offering the 50% off sales promotion? How can Sprint get away from 1/2 off while their 'Why pay twice as much for 1% difference in network performance' campaign' is being used? How can Sprint produce several times the gain in subscribers as seen last quarter AND increase prices by reducing or eliminating the 50% off sales campaign?
(Dirty) Harry Callihan: Uh uh. I know what you're thinking. "Did he fire six shots or only five?" Well to tell you the truth in all this excitement I kinda lost track myself. But being this is a .44 Magnum, the most powerful handgun in the world and would blow your head clean off, you've gotta ask yourself one question: "Do I feel lucky?" Well, do ya, punk?
Go for the gun.