Brightpoint Named a Winner After AT&T Drops T-Mobile Bid (CELL, T)

December 20, 2011 by Jon C. Ogg

Brightpoint Inc. (NASDAQ: CELL) is being called a winner now that AT&T Inc. (NYSE: T) has dropped its planned acquisition of T-Mobile.  Canaccord Genuity is reiterating its “Buy” rating and its $14.00 price target objective after a $9.14 close on Monday.

The distributor for mobile communications devices should see “increased visibility into its logistics business for 2012 as T-Mobile is a significant forward- and reverse-logistics customer.”

The research noted, “Further, we believe an increasing mix of smartphones globally should increase opportunities for Brightpoint’s logistics services and raise ASPs in the company’s distribution business, and both should increase gross profit dollars.”

The biggest issue is that the associated overhang on this stock should dissipate as T-Mobile is a significant customer for Brightpoint, while AT&T is NOT a customer. This overhang has pressured Brightpoint shares since March.

Today’s research noted that the business loss would have been $0.10 to 0.13 off of the earnings per share starting in 2013.  Now it should win from the increasing mix of smartphones and the firm’s checks indicate solid global smartphone sales despite specific struggles by RIM and HTC.

JON C. OGG

Sponsored: Find a Qualified Financial Advisor

Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to 3 fiduciary financial advisors in your area in 5 minutes. Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests. If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.