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So says Greg Miller, analyst with Canaccord Genuity, who this week lowered his estimate for Sprint’s stock price to $5.75 per share. It was sitting at $5.69 on Thursday at 1:45 p.m. ET.
“We view the [pricing] decision as logical – if not belated – as lower prices should enable the company to better compete with the other three major national players; however, lower prices and higher customer acquisition costs will pressure both revenue and margins, in our view. Further, with the company’s network transition still behind that of its rivals, we remain skeptical that pricing more in line with peers will be sufficient to generate meaningful subscriber gross add share in the near-term.”
Miller previously was more bullish on Sprint, predicting its stock price would rise to $7.50, but he has backed way off of that. He reiterated his “hold” rating.
There’s little doubt that Sprint needed to do something to set itself apart in the market. Rival T-Mobile last year launched its “uncarrier” initiative that did away with postpaid contracts for new customers. And the battle against AT&T and Verizon has been an uphill one because those larger competitors have been much faster at upgrading their networks.
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January 16 2019 @ 18:48:27 UTC