Shares of Sprint Nextel Corp. regained all of Tuesday’s lost ground in trading that lifted prices to $5.18 this afternoon.
Sprint had suffered a 28-cent loss on Tuesday amid reports that Deutsche Telekom’s T-Mobile USA would merge with smaller carrier MetroPCS Communications Inc. Investors saw the deal as squeezing Sprint competitively.
The real merger announcement today fell pretty much in line with the unconfirmed reports, and traders seemed to view reality as less threatening than rumor.
It also helped that two analysts have come to Sprint’s rescue with favorable mentions.
CitiGroup analyst Michael Rollins already liked Sprint but added that he sees it outperforming MetroPCS shares in the next few months, according to Bloomberg News.
Nomura Equity Research’s report reaffirmed analyst Mike McCormack’s buy rating on Sprint and said he sees its exclusion from a deal as positive. It keeps Sprint management’s attention focused on the key job of network upgrade and “internal improvement.”
| Mark Davis, email@example.com