28 Aug

Sprint’s 5G Goes Live in More Cities—What’s Next?

WRITTEN BY Ambrish Shah

On Tuesday, Sprint’s (S) mobile 5G (fifth-generation) network went live in certain parts of Los Angeles, Phoenix, New York City, and Washington, DC. These cities joined the existing 5G service areas in Dallas-Fort Worth, Atlanta, Chicago, Houston, and Kansas City. The company’s mobile 5G service promises to deliver faster speeds and consistent coverage. Sprint is working with equipment manufacturers such as Ericsson, Nokia, and Samsung Networks to build its mobile nationwide 5G network.

According to a FierceWireless report on August 27, “At the foundation of Sprint’s 5G is Massive MIMO, which can dramatically improve network capacity. In Los Angeles, New York City, Phoenix and Washington, D.C., Sprint is using 64T64R (64 transmitters 64 receivers) 5G Massive MIMO radios from Nokia. The radios support a feature called split-mode that enables Sprint to simultaneously deliver LTE Advanced and 5G New Radio … service.”

Sprint’s 5G devices and coverage

On Tuesday, Sprint unveiled the availability of its fourth 5G-compatible device, the OnePlus 7 Pro 5G. Its other three 5G-compatible devices include the LG V50 ThinQ 5G, Samsung Galaxy S10 5G, and HTC 5G Hub.

Currently, Sprint’s 5G service has total coverage of about 2,100 square miles, with about “11 million people expected to be covered in total across all nine market areas in the coming weeks.”

Merger with T-Mobile

Sprint is making progress in closing the proposed merger agreement with T-Mobile (TMUS). Sprint believes that the merger with T-Mobile would help Sprint “to accelerate the deployment of a ubiquitous, nationwide 5G network that includes coverage in rural locations.”

Last month, the US Department of Justice officially approved the combination of T-Mobile and Sprint. Earlier this month, FCC Chairman Ajit Pai officially recommended approving the merger deal. However, the merger deal is currently facing a lawsuit opposing the combination on antitrust concerns.

Read Why Critics Want Public Review of T-Mobile–Sprint Merger and T-Mobile and Sprint Aim to Settle States’ Lawsuit to learn more about the merger deal.

Stock performance

Sprint stock closed 2.19% lower on Tuesday at $6.70. The stock is trading 16.9% lower than its 52-week high of $8.06. The company is trading 23.2% higher than its 52-week low of $5.44. On Tuesday, AT&T (T) stock fell 0.60% and closed at $34.72, while T-Mobile stock fell 1.20% to $77.12.

Year-to-date, Sprint stock has risen 15.1%. The stock has returned -16.2% in the trailing-one-month period and 9.8% in the trailing-12-month period. In comparison, AT&T and T-Mobile have seen their stock prices rise 21.7% and 21.2%, respectively, year-to-date.

Sprint’s market capitalization is $27.4 billion, while AT&T and T-Mobile stand at $253.7 billion and $65.9 billion, respectively.

Analysts’ recommendations for Sprint stock

Among the 19 analysts that cover Sprint, 10.5% recommended a “buy” rating, 73.7% recommended a “hold” rating, and 15.8% recommended a “sell” rating. Currently, analysts have a 12-month target price of $6.86.

On August 27, the company was trading at a discount of 2.4% from analysts’ 12-month target price. The stock’s median target price was $6.25 on the same date.

Technical levels

Based on the closing price on August 27, Sprint stock was trading 2.0% below its 20-day moving average of $6.84, 4.1% below its 50-day moving average of $6.99, and 1.1% above its 100-day moving average of $6.63. On the upside, the company’s immediate key resistance lies near $6.81, while $6.64 could act as an immediate key support level on a daily basis. The company’s 14-day RSI (relative strength index) score was 43, which indicates that investors are neutral toward the stock.

In the trading session on August 27, Sprint stock closed near its Bollinger Band midrange level of $6.84. The value indicates that the stock is neither overbought nor oversold.

Financial performance

Sprint posted revenues of $8.14 billion in the first quarter of fiscal 2019 (quarter ended June 30), beating the consensus estimate of $8.06 billion by 1.0%. However, the company’s top line rose 0.2% year-over-year.

In the first quarter of fiscal 2019, the company reported adjusted EPS of -$0.03, beating the consensus estimate of -$0.04. In the first quarter of fiscal 2018, Sprint reported adjusted EPS of $0.04.

On June 30, Sprint had 54.3 million wireless connections, a fall of 0.5% year-over-year, including 33.1 million postpaid customers, 8.6 million prepaid customers, and 12.6 million wholesale customers.

Sprint shed 128,000 postpaid phone net subscribers in the June quarter. T-Mobile added 710,000 postpaid phone net customers, and AT&T added 72,000 postpaid phone net subscribers in the second quarter, respectively.

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