Citi Maintains Buy on Sprint Nextel

Citi is out with its report today on Sprint Nextel S, maintaining Buy. In a note to clients, Citi writes, "We remain a Buyer of Sprint based on: 1) growing wireless revenue with rising Sprint-branded subscriptions; 2) improving its operating margins over time through Network Vision & possibly Network hosting; & 3) emerging as the value-based provider of wireless service within the industry with AT&T's pending acquisition of T-Mobile USA and as a possible beneficiary of merger conditions and concessions if the deal gets approved. We believe the option value for Sprint from a broader wholesale deal with Cox and pursuing network hosting/sharing relationships can be worth up to an incremental $1-2 per share relative to our current analysis." Citi has a $6 PT on S. At the time of posting, shares of S were trading pre-market at $5.84, up 0.17% from Wednesday's close.