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Wednesday, July 12, 2006

Most Widely Traded 48 Hour Clock: Sprint Nextel & Others

24/7 Wall St. has begun coverage of the 36 most widely traded stocks, eighteen each from the NYSE and the NASDAQ. Most of these stocks trade over 50 million shares a week. This new feature will highlight each of the 36 stocks at least every 48 hours giving investors fresh infomation and perspective on the companies whose shares are most likely to move the broader markets.

Stock Ticker: S, T, VZ, Q, AT

Standard & Poor's Equity Research issued a powerful research note yesterday as it raised its rating on Sprint Nextel (S-NYSE) to "strong buy" from "hold" with a more favorable valuation for its shares over the telecom players. Shares yesterday closed up only $0.10 after the market recovered sharply and on this research note.

Here are some of the quote summaries out of the research article: "We think the stock is trading below fair value, which we believe is $26.00...... We think Sprint will grow faster than RBOCs..... shares are attractive..... priced near peers..... Sprint should grow faster."

In addition, S&P's analyst noted that there is a potential for Sprint's board to authorize a stock buyback plan based on the company's strong cash flow. This was surprising that there was not a formal buyback plan in place, and this makes sense now that Spring Nextel has just about cleared up all of the smaller ex-PCS plays that it and Nextel had spun-off in the 1990's by doing re-acquisitions. In just the last 30 days it has completed the roll-ups of Ubiquitel and NexTel Partners.

As of yesterday, Sprint shares were down about 16% year to date and shares were down about 28% from the April highs of $27.20. Sprint Nextel will report earnings August 3, 2006.

Rival shares didn't fare to well yesterday with the rally: AT&T (T) closed down $0.14 at $27.24; Verizon (VZ) closed down $0.29 at $32.69; Qwest Communications (Q) closed down $0.05 at $7.98; Alltel (AT) closed down $0.09 at $64.45.

Jon C. Ogg
July 12, 2006
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