Stifel Downgrades Sprint

In a morning research summary published Monday, Stifel analyst Christopher King downgraded shares of

to Sell. King noted the recent run-up in shares, up 30% in the past four weeks and up 71% during the 2013 fourth quarter. The analyst further commented on his skepticism of the company's near-term merger and acquisitions prospects. Stifel reported that a merger between Sprint and T-Mobile US, Inc.

would benefit the domestic wireless industry, there are concerns regarding the regulatory approval for the deal. King commented, “We foresee several potential antitrust/regulatory objections to a S/TMUS merger, including: (1) DOJ's stated preference for maintaining an industry structure of four national wireless competitors in an already concentrated market, (2) likely DOJ/FCC preference for preserving TMUS as a maverick, particularly given that its recent acquisitions of Metro PCS and substantial spectrum assets, as well as solid operational performance, have put it in a much stronger position than it was just one year ago, and (3) expected FCC preference for maintaining four national carriers as potential bidders in the upcoming broadcast incentive auction.” Stifel added that Sprint remains at an operational disadvantage to Verizon Communications Inc.

and AT&T, Inc.

. The analyst added, “Although the recent shutdown of its IDEN network, in combination with its larger Network Vision strategy should drive margins higher over the course of the next several years, we believe the company will continue to struggle to add a significant number of postpaid subscribers in the near-term.” Shares of Sprint closed at $10.75 on Thursday and are trading down 3.26% in pre-market trading.