Telecom & Wireless

Sprint Stock On Its Way To Doubling

Sprint Nextel Corporation (NYSE: S) has witnessed a substantial recovery.  In fact, its shares are now almost three-quarters of the way to having doubled off of its $2.10 low seen on January 31, 2012.  It is hard to believe that Sprint may be catching back up to AT&T Inc. (NYSE: T) and to Verizon Communications Inc. (NYSE: VZ

) but it is Sprint which has had the best stock performance of the big three wireless telecom providers so far in 2012.

The move of integrating a buyback option into online purchases is one small boost as the move to allow offering equipment to businesses to support their own wireless networks, but a research call is aiding this turnaround today.  Credit Suisse maintained its Outperform and “value” rating today but it raised its price target objective to $6.00 per share from $4.00 per share in its analyst ratings this morning.  The research report signaled an increased EBITDA based in part on its Network Vision update.

Another boost today came from Jim Cramer on CNBC who went on record saying that he thinks that CEO Dan Hesse has done a fabulous job of late in turning the ship around here.

To show just how big the move has been, Sprint shares are up 5.6% at $3.65 on the day, while its average daily volume has already been eclipsed at 66 million shares with almost 3 hours until the market closes. For Sprint shares to have doubled from the $2.10 low from January the stock would have to rise to $4.20.  At $3.65 today on strong volume, Sprint is already about 74% of the way to doubling.

What is so interesting is that Sprint Nextel is considered by many as an at-risk company as some investors think that the company could ultimately implode under its debt and operating losses.  The Apple Inc. (NASDAQ: AAPL) iPhone was even removed from Dan Hesse’s performance targets in his bonus and pay structure. 

JON C. OGG