Sprint has moved back up and gone a bit further. S looks increasingly overbought and volume show that buying pressure is running out of steam IMO. Meanwhile, AT&T (T) and Verizon (VZ) have shot up to new highs while T-Mobile (TMUS) has hit a triple test of the high at 44. That comes on the heels of the FUD market sell off due to Brexit. The telecommunications sector looks overbought and due for some profit taking soon.
What to do now: previously I said S was biased to the downside but to place close-in stop loss orders. I said taht because the market and stock have turned volatile with a number of factors coming into play that can send stocks up or down more sharply than usual. That has proven to be the cse. Brexit probably caused some money to flee British and EU securities and bonds to flow into the US as a relative safe-haven. adding to the reasons to think that is that some stocks have moved up despite having no change or somewhat bad news that might otherwise have seen the stocks move sideways to down. The move up may continue for an extended period. However, my sense is there will be some pull back in the telecomm sector by next week with S and TMUS being impacted as well as profit taking in VZ and T.
Sprint looks more likely to revert towards the mean of the trading channel near 3.3, near the analyst consensus target price of 3.50.
Show a single post on any reputable financial site or news service that says that money Softbank received has been put into Sprint's accounts. You bozo liar... you cannot be this stupid of a punkarse.
Parkervision is 'allowed to live' because it is a company constituted on effectively gaming the US patent (administration) and NASDAK stock exchange. PV does what is needed to stay legit: lawyering up to prevent class action lawsuits based on false representation and outlandish promises that have repeatedly been disproven being brought up as grounds for legal battles. If not for that, PRKR probably would have been targeted by class-action law firms years ago. Its pretty rediculous when you think about it... how could Jeffrey P get away with making repeated promises of new customers, products, licensees, etc. over and over again without having been called on the carpet as falsely representing the stock in violation of securities laws designed to, chuckle, protect the public?
JP and his legal flunkies are scammers.. crooks anointed by the corrupt US legal system.. its a blight on our society that is unlikely to be corrected.. a pucked up situation amidst that having become the norm of the legal profession.
Shares are shorted for various reasons; 1. to trade the downside. 2. To hedge long investments in other stocks or in debt/bonds. Sprint has been among the most highly shorted stocks, between 80 and 220 million shares over the past decade. A reason for that is the risk associated with the debt. As Sprint's debt risk increased so did the degree of shorting. Of course, that also increased due to the deteriorating financial and market position of the company.
Short interest decreased recently because the level of risk of the bonds has gone down. As mentioned early this week, the price of the bonds has gone from a discount to a slight premium of face value on nearer-term instruments, showing the impact of swapping assets for capital to repay the debt.
What we are talking about in degree of change is from record high levels to what is a level at the top 1/3 of historical levels. Latest SI report:
Short Interest (Shares Short) 175,070,500
Short Interest Ratio (Days To Cover) 17.0
Short Percent of Float 26.83 %
Short % Increase / Decrease -2 %
Short Interest (Shares Short) - Prior 178,516,900
Another reason for SI moving down can be lower trading volume. Short positions become harder to cover as volume traded moves lower, which was the case until last week.
I had posted that short interest was more likely to move up as the stock price has moved up.. so was wrong in that prediction. However, I stick with the prediction that S has reached a level in which it is biased to the downside. Saying a stock is biased indicates how to strategize your trades, not exactly when to pull the trigger. You should be using program trading or otherwise move out of positions if they turn against you. S is more likely to move down but if it breaks further to the upside from this point, you get out and set a new trade if that looks favorable.
S could move higher if the new ad campaign nets results. So, does that mean S turns into a total winner? No, 'course not.
LOL! If I have delusions then they must be whispered by the spirits. Long's delusions over the past ten years have led to the loss of over fifty billion in equity value. My 'delusions' have proven to have been right. Fat lady luck I guess.
About the only thing that Sprint (S) showed 'great progress' in relative to its past position is the share price increased from prior low levels. Sprint has improved network quality and all operators have come much closer together in most of the individual metrics that make up 'performance'. However, Sprint (and T-Mobile) still rely on roaming on Verizon and AT&T, lease of competitors and third-party backhaul, lack of participation in IoT, government and other segments of the market that comprise the 'full service' banquet offered by Verizon and AT&T. That help to spread the cost of building and maintaining competitor's networks compared to Sprint. While network metrics are certainly important, it fails to capture other aspects of the competitive business model.
Sprint is a high beta trading stock, a very unproven stock for long-term investment. In fact, it is much easier to say that Sprint (S) is proven not to be a good long-term investment because the path they are on leads to selling off the base of assets. It will take the long=promised gargantuan turnaround to change that.
It takes years to build a 'revolutionary' WBB network:
Fifteen years ago when 4G was still years away. I concluded that high-frequency use required user deployment or use of low-frequency band as the beachfront. WiFi had grown in popularity to the point it served as an example of what the cost of deployment by the user might look like: 3G-4G smallcell network devices were more expensive and less capable than they are today. Nonetheless, the cost of a user-deployed smallcell on the roof, window or outside wall of their home or high-rise apartment building would be a fraction of the cost of putting in a typical base station.
To make user deployment work, the network had to be developed to use existing macrocell base stations - a HetNet. Smallcells must connect by big pipes to the Internet and the WWAN, wireless wide-area (mobile) network. Operators thousands of macrocells was the starting point. Lingering today, these needed higher bandwidth connections using fiber optic or other gigabit level connectivity.
The other requirement is to achieve grid density: a neighborhood needed at least one or two out of every ten homes or buildings to participate or else coverage and BB density is not achieved and the savings and marketing impact fails to develop.
Today the market is highly absorbed. Give users a discount and promise of mega bandwidth can be a selling point. However, to change the pivot point requires an uphill block-block recruitment effort coordinated with the network build out so that weak links in bandwidth or coverage are not present.
Revolutions require time and achieving 'critical mass'. That evaluates to being much easier when an industry is still emerging than when it is at over 90% absorbed and time is almost gone and capital has already been spent and must be paid back using assets.
What Softbank cannot do:
1) Gift money to Sprint. Softbank cannot give its' (shareholders' and debt holders') money to Sprint without receiving assets and payments in return.
2) SB cannot operate within a vacuum. Efforts to plunge into '5G' can have benefits, however, it costs ten to thirty billion dollars to do any major network expansion of upgrade from one generation to the next. All competitors are pursuing 5G. The technology used is based on standards that all suppliers and operators must use.
3) Change the timeline. SB or Sprint cannot press a button to shift networks or market position or extinguish debts. Sprint-SB is racing to jump over a constantly moving goalpost.
Softbank is pursuing much of what they can do already. The options open to them going forward are, for the most part, to do more of what they have been doing: more asset buys that are leased back to Sprint and that require Sprint to buy them back or face losing the network and spectrum assets altogether. Softbank is not being malicious in how that is set up: they are doing everything they can while fulfilling the legal responsibilities to their own share and debt holders.
A glimmer of hope: The long needed push into smallcells now tuned to '5G' costs billions. Sprint-SB could benefit from a 'personal network revolution' in which users place rooftop and outside wall mounted micro base stations (3GPP term is Home eNodeB) that include the latest signaling, antenna, and network technologies. These would 'self-register' and self-manage themselves so that the user or installer puts it up and turns it on with little or no adjustments by the user. They would 'self-backhaul' to the next node or directly to a high bandwidth base station. This could use a phone app to aid the setup and registration with the network, but that would mostly be a marketing thing, not a requirement. One problem: it takes years. It should have been started ten years ago.
Funny business on the school playground. Lets make up more dumbed-down analogies: If pigs had wings they would fly like hummingbirds.
1) Sprint is losing money vs. TMUS is profitable. S is forecast to continue losing through 2018. With $13.5 billion in debt repayments coming due between now and then, Sprint is destined to sell off equity in the company to repay it.
2) Softbank's money is theirs, not yours/Sprint shareholders. This is not a grade school playground where you can grab the ball off the field and play by your own rules.
3) Sprint has higher costs because a) S's interest payments are about 45% more than T-M's. Interest alone zaps almost $2 billion. b) The cost of operating a high-frequency network is between up to 3 times higher than building a network at lower frequency bands. And since Sprint is the only US operator using 2.5GHz Band 41 spectrum, others devices and the vast majority of generic market devices don't work. Sprint must shoulder the cost and time lag of populating the network with devices, making it more costly to grab other operators customers. There is much less BYOD, bring your own devices. "World Phone" devices won't work on S's 4G-5G network.
Corporate expenses make up a fraction of the cost for mobile operators. Sprint is well down the road of the 3rd round of cost-cutting efforts and there is little fat left on the bone. Sprint finds itself in the position of cutting into muscle - cuts in network improvement. The money has to come from sale of core assets to the parent company. Softbank runs a tight ship: they get asset rights when S can't pay back the new loans.
It has become conceivable that Sprint can roll over some debt into new junk bonds that can be used to pay off the lend-lease of networks and spectrum.
One good thing that has happened for Sprint-Softbank is that the bonds have gone from trading at a steep discount to slightly above par for nearer term duration. Nine-12 months ago bonds were trading at as low as 60c on the dollar, a sign that the market thought there was a chance for default. The change is no doubt due to Softbank's establishment of loan-lease companies which hold Sprint asset pools subject to buy-back within 2-3 years or forfeit occurs.
The bond instruments reflect easing of fears of default. The longest term instruments still trade at a slight discount, showing some residual disquiet remains. Sprint has $2 billion of bonds to repay this year and $3.3B due in 2017. The crunch year is 2018 when $9 billion or the now $34B in debt must be paid back. Until then, there is very unlikely to be a major capex spending boost by Sprint.
What is likely? I doubt that Sprint can repay the lend-lease loans and become profitable and competitive in networks before the end of 2018 after a large part of the debt repayment is cleared. What may be contingently planned is that Softbank, with Masa Son directly involved, will expand smallcell network development within the network-Spectrum leaseco that helps place Sprint in a more competitive window of opportunity for what will be touted as 5G, broadband-everywhere. That has been the gold ring on the merry-go-round for over a decade - capturing both mobile and broadband-to-the-home revenues. Clearlywired tried to do that and then failed to follow through as they adopted a macrocell-only bonehead network strategy. The industry has matured - network technology and devices are now available that make this mainstream off-the-shelf feasible with a market primed for uptake. But this takes timing, execution, and capital or else competitors will filed their competitive offerings as 3.5GHz, 5GHz fill the gap between the high band haves and have-not-yets.
Are you delusional or lie on purpose? Sprint has $0 in the bank due to the sale of that other company's assets. Zero. Do you contest that? It is one thing to suggest that Sprint may benefit from Softbank spending part of the proceeds, after taxes and other commitments, in an exchange with Softbank for assets or cash flows, it is a lie or amateur wrong to say that the whole amount (actually more than the whole amount which is $18 billion) from the sale of Softbank's companies will be transferred to Sprint. That does not happen, not even in companies operated by idiots. It has never happened in one of Masa Son's companies.
No, what I said takes someone with some sense to understand how to set orders to buy on breaks up or down and take profit when the trade turns. You do not know how to do that so you misunderstand what was posted..
Sprint is down today by nearly 7% following a prolonged rally bolstered by the news that Softbank is beefing up its balance sheet by selling off gaming, a portion of Alibaba and other assets. Speculation is that some of this will filter into Sprint. S has also benefitted from its well-directed ad campaign that asks viewers if 1% lower performance than leader Verizon is worth paying twice the price. The claim is a bit over the top because most network studies still show that Sprint ranks in fourth place in overall network performance. However, Sprint has improved to the point where their claims are within reason of ringing true... acceptable marketing BS.
TA: As mentioned yesterday, Sprint was being set up to reverse. Those long the stock who placed recommended close-in stop-loss orders should have captured most of the recent gains. S may bounce around in this volatile market climate. The mid-long term bias is bearish. S had reached an overbought condition not supported by fundamentals. Speculative jolts to the upside are bound to give way as reality creeps back into the valuation.
What to do now: Now looks like a good point to take profits or go short. S may retest the ST high. Care should be taken to set trailing stop-loss orders outside the expected level of volatility.
Sprint (S) shot past the upside target of 4.10. Those who bought and initiated a price-following stop-loss order will still be in the trade until S breaks to the downside.
All traders should study up and gain experience in using trend-following stop-loss orders and conditional buy/short orders. If your broker does not provide such capability, and you trade actively, change brokers immediately.
What to do now:
Sprint has been influenced by the restructuring of finances and management of the parent company. That leads to speculation that Sprint will be helped out to a greater extent than previously understood. There is some validity to that speculation, however, Sprint won't be gifted with funds Softbank needs to bail out its own debt position.
The TA remains short-term mildly bullish, mid-to-long-term bearish IMO. Profit taking or short trade to the downside are now the priority for conditional trades. Long trades should be followed by close-in trailing stop-loss orders.
Can the upward trend keep going? Sure. Masa Son has a lot of skin in the game and he is a highly skilled and determined person. However, he is also a very pragmatic business person. Masa does not give money away. He demands positive ROI performance - which is why SB is buying S's assets not gifting it with "free money". He gets +ROI from the new asset companies. The crux is that this means 'great things!' relative to past performance for SB while S remains mired in debt and asset buy-back
Traders anticipate and follow trends up or down. Strategic traders will play long for as long as it plays out, flip to the downside when reality sets (back) in.
You have a short memory: The all-time low was before Softbank acquired Sprint, 1.84. Sprint had gone down because it was running out of money by 2012 and had to be bailed out. Softbank bailed Sprint out but it has continued to lose money every quarter since while debt has piled higher to ~$34 billion.
Have fun with you memory loss euphoria.
Anyone who advertises they can 'make a killing' in stocks is likely an amateur or stock newsletter promoter. Making money is done on a risk vs. reward basis.. it is not what you make in paper trades but what you keep.
I think this is a good time to consider shorting Sprint (S). The current rally has gone above the 4.10 mark mentioned in previous posts as the possible high end of the near-term range. S is nearing an overbought condition.
By all means, act on your convictions. Then come back in a month and compare notes.
Short interest remains over 187 million shares. 'All the shorts' are who? Short selling has remained high in Sprint (S) despite fresh loans for assets from Softbank because that is not what SB's investment is helping out most.
Pro traders use price trend following stop-loss orders so that if a stock moves against their position, they get out. Some short sellers have held positions over the past six+ months as seen by the short interest numbers which have remained at or near historically high levels.
What are short sellers as a group doing now? I suspect that they have swung back to loading up positions. The short interest reports come out every two business weeks with data delayed a few more days to compile it. The next report may remain around 178 million shares. I suspect the following report to move back up, possibly over 200M shares.
The short sellers are alive and well. Sprint has been among the most profitable stocks to short over the past ten years, netting tens of billions of dollars for the dastardly traders who dare to short such money-losing companies.
Softbank set out to expand into services and software in emerging world markets prior to hiring Arora. Arora appeared as a good fit for those goals. However, the acquisition of Sprint was thought to have turned profitable so that it would pay off the $34 billion in debt, freeing Softbank to pursue expansion through acquisitions in India, China etc. Sprint has continued to lose money despite deep cost cutting and aggressive marketing efforts.
The result of all the above is that Arora is no longer a fit with Softbank's circumstances. His performance up to now has certainly played a part. For example, the sale of gaming assets was forced on Softbank in order to fix up the balance sheet - work down the some $75 billion in total debt to a more tolerable level. I thought that when Arora was hired he might expand the gaming portion of the business to broaden its competitiveness and growth. That he wasn't able to galvanize that or other moves closed off the option of satisfying debt through high growth.
Softbank has to clean up its balance sheet, consolidate efforts to further streamline business and remove Sprint's debt liabilities and continued losses from the equation. That is an improvement over the embattled situation that can help unlock stock value. It is not a finish line.
Sprint has no discernable time to market or technology advantage in the use of the higher frequency bands due to be freed up by the FCC. You guys hype this up without saying why it is so: it just is because speculation without details is easy to slide past people.
Does Sprint-Softbank's have technical advantages in using high-frequency spectrum, what are they, and how can they be used?
At the time Softbank acquired Sprint three years ago, they were perhaps the world leader in advanced techniques to use 2.5GHz and higher bands. However, the equipment and network device suppliers have been working on methods including smallcells and interference mitigation needed to yield higher spectrum utilization for several years. SB jumped early to use the new methods because few operators in the world had the spectrum available.
The use of higher bands has been planned for more than 12 years. Allocations for the bands were outlined by ITC, 3GPP, IEEE so that country/regional regulators could provide availability for when commercial use became viable.
The FCC is opening up 3.5GHz as 'the innovation band' and several higher frequency bands to layer service in somewhat of an orchestrated fashion.
Time to market takes capital and execution.
Sprint does not have the time to market or technology advantage because all operators have been working with suppliers to exploit the 3.5, 5+ GHz bands. VZ, T, TMUS, and S are doing work in these bands so that when they are available and the equipment market has moved down the price and availability curve they will be ready.
Sprint already has an unused high band.
What advantage does more high band give Sprint? S-SB have had three years+ to turn the 2.5-2.6GHz into the long promised advantage using the diminishing lead in technology. Technology does not age well - soon everyone has it and prices come down. Tech has to be used with strategic timing and leveraged application or competitors have saddled up and ride past you.