Citi Downgrades Clearwire (CLWR) to Sell
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Citi downgrades Clearwire (Nasdaq: CLWR) from Hold to Sell. Price target lowered from $17 to $13.
Citi analyst says, "Our sell rating and downwardly revised target price of $13 on Clearwire is partly-based on some of the same challenges that remain for the combined businesses with respect to a coverage plan that reaches less than half of the Country by 2010, an unclear path to dual-mode devices to leverage Sprint's CDMA coverage, an under-funded business plan, existing mobile broadband competition that will likely launch a national LTE footprint in the 2010-11 timeframe, a business plan that may create channel conflict between the owners of the joint venture, and a premium valuation relative to our fair value assessment."
Clearwire Corporation builds and operates wireless broadband networks that enable Internet communications. [SM]
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Comments
manipulation
There's no other explanation for a downgrade timed so closely after positive news.
Citi downgrade
The reasoning used is blatantly false logic! "existing... that will likely launch" EITHER IT IS-OR ISN'T! Citi must either hold or have a HUGE client that holds a significant short position in CLWR.
Citi on crack
Yes, I agree the Citi folks must be on crack or are geniouses. Maybe after the stock tanks and hits rock bottom from their downgrade, then they will change their tune to "buy buy buy" and make a killing after the merger takes place. Maybe folks trade too much on "headlines" rather than look deeper into the company.
Citi needs better analyst
I read the comment by the Citi Analyst and my conclusion is that he or she needs to go to school because the downgrade does not make sense. What has changed from before Clearwire teamed up with Sprint and now? Nothing about the operational/execution aspects of Clearwire's business. Not outlook revisions, no target changes. Citi analyst is smoking something he or she ought not to be smoking.
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Agree with OH
Gator on May 27, 2008 10:31 PMnothing changed except for the better. Tell your client the short is over, cover and move on.