Move to Offense on Sprint (S), Nomura Recommends

Nomura Securities analyst Adam Ilkowitz lowered its price target on Sprint (NYSE: S) to $9.50 (from $10.50) but maintained a Buy as the target represents 71.5% upside. Ilkowitz is recommending moving to offense on the name.

Ilkowitz comments, "We believe Sprint shares are trading at 5.9x CY15 Adj. EBITDA on our updated estimates, clearly not yet discounting what we see as underlying improvements in operations. While subscriber losses and aggressive pricing are daunting headlines to overcome, we believe investors are overlooking the gains in EBITDA to come and where the network will be next year. We believe Sprint will continue to post EBITDA growth, stabilize the customer base, and avoid draconian capital raising requirements to purchase spectrum. As we have cut estimates owing to the pricing, though our forecasts could prove conservative, we are lowering our DCF-based target price to $9.50."

For an analyst ratings summary and ratings history on Sprint click here. For more ratings news on Sprint click here.

Shares of Sprint closed at $5.58 yesterday.

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