Link between Sprint and Warren Buffett is a head scratcher for Wall Street

Anytime Warren Buffett’s name gets connected to a stock, Wall Street pays attention. But analysts on Monday weren’t sure what to make of the Omaha investor’s possible link to Sprint.

Unconfirmed reports Friday said Buffett, head of Omaha-based Berkshire Hathaway Inc., had talked with Sprint chairman Masayoshi Son about participating in some sort of deal involving the Overland Park-based wireless company.

Details were “fluid,” according to a Monday report from Jennifer Fritzsche, an analyst at Wells Fargo Securities. “So fluid, in fact, we were half choosing not to write about this event as no company has commented,” her report said.

Mostly, analysts came up only with questions about the reported talk even after taking the weekend to ponder it, or perhaps investigate further.

“Why does he need Buffett’s money or credibility?” BTIG Research analyst Walter Piecyk asked about Sprint’s Son in a Monday report to clients.

Piecyk noted that Son is no slouch. His report called Son “undoubtedly one of the most respected, credible investors/operators of his era.” And he noted that Son is CEO of Tokyo-based SoftBank Group Corp., which just put together a $100 billion investment fund by bringing in partners such as Apple and Qualcomm.

Piecyk wasn’t alone. Amir Rodwadowski, telecom analyst at Barclays, acknowledged in a report to clients Monday that he’s been scratching his head since the Buffett/Sprint report.

“Once again, we recognize that the limits of our own imaginations may be an issue here, but it just seems difficult to see how an investment like this would progress,” Rodwadowski’s note said.

A big investment in Sprint would make sense only if it was part of a much larger transaction with T-Mobile, according to Craig Moffett, who follows the industry at MoffettNathanson Research.

Moffett wrote that “it is hard to imagine that anyone would want to make a bid equity investment without a deal” with T-Mobile.

This story was originally published July 17, 2017 at 11:40 AM with the headline "Link between Sprint and Warren Buffett is a head scratcher for Wall Street."