Monday, March 21, 2011

Sprint: Great Value or a Value Trap?

H.J. Huney submits:

With AT&T's (T) acquisition of T-Mobile over the weekend, there is perhaps no stock that becomes more intriguing now than Sprint (S). As I write this article, Sprint has suffered a devastating 16% decline in its stock price as a result of AT&T?s acquisition. While I would attribute this largely to market irrationality, on one hand, that doesn't necessarily mean that the case for buying Sprint is that strong, either.

I have followed the back-and-forth on Sprint for about a year now and I have analyzed the company myself a few times. Yet, I've never been able to come to a strong conclusion one way or another.

Amongst hedge funds, David Einhorn's Greenlight Capital appears to be the most bullish on the stock. Financial blogger Chad Brand has recently posted a bullish case, as well. Chad Brand believes that Sprint is recovering and that the company still has many small


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