Piper Jaffray is out with a research report this morning, where it reiterates its Underweight rating on Sprint Nextel Corp. S; it has a $3.50 price target on the stock.
The PJ analysts cited the company’s recent earnings report, which was better than expected with management calling for continued subscriber growth. Positive notables included better than expected prepaid and total net add losses, as well as lower prepaid churn and increased margins.
Negatives for the company, according to the Piper analysts, included lower than expected prepaid net adds, as well as the expectation for margin declines into Q3.
As for valuation, the analysts said, “We rate Sprint Underweight with a $3.50 price target. Our price target is based on our five-year DCF analysis, using a 10.0% near-term cost of capital, an 8.1% terminal cost of capital and a 1.3% terminal growth rate.”
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Posted In: Analyst ColorPrice TargetAnalyst RatingsPiper JaffrayTelecommunication ServicesWireless Telecommunication Services
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