UPDATE: JP Morgan Upgrades Sprint on Long-Term Strategy
In a report published by JP Morgan, analyst Philip Cusick upgraded Sprint Nextel (NYSE: S) from Neutral to Overweight and raised the price target from $6.00 to $8.00.
In the report, JP Morgan wrote, "We have recently been cautious on Sprint due to the operational challenges facing the company regarding continued subscriber headwinds as well as high opex and capex spend. However, the proposed acquisitions by DISH and Softbank (covered by J.P. Morgan analyst Hitoshi Hosoya) outweigh near-term concerns and likely put a floor under shares in the $7 range. Medium-term, we see substantial EBITDA tailwinds for Sprint as Network Vision spending tails off and cost savings are realized, which could be magnified by a combination with Dish. Finally, we could see an upsized bid from Softbank as well as a response from DISH."
Shares of Sprint Nextel closed Monday at $7.06 and are currently up 0.99 percent pre-market.
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