Buy Sprint Nextel? Cramer’s Take!

 

Buy Sprint Nextel? Cramer’s Take!

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here and help you find worthy speculative stories, risky,underappreciated stocks, often trading in the single digits that have the phonetion to deliver, outsize returns. we speculate because it is fun. not so much a factor on a terrific day like today. we do it because speculating can be incredibly lucrative when it’s done right. buy. buy. buy. i found you the holy grail ofspeculation, when you have a single digit minute jet trading up from below $5 a share to above the crucial five buck threshold.why is $5 so important? why not $4 or $6? simple. most big institutions are not allowed to own stocks that trade for less than $5. when a stock crosses above that level, you get a whole new glass of buyers, all the mutual funds and hedge funds, weren’t allowed to own the darn thing when it was lower. when you add more buyers to the mix, guess what supply anddemand, stocks tend to go higher. why i think you have to be very interested in sprint nextel. yeah, i know. i have liked it that’s all right. sprint nextel here, four and change. ain’t missed anything. sprint is about 70 cents away from that $5 line. once it gets over the hump, i see climbing much higher. why am i confident sprint, the perennial third wheel in the u.s. wireless business and a company struggling for years is done going down and now going up? because wednesday night, sprintreported actually a phenomenal quarter, a thing of beauty, these results confirmed that this company’s got one of the greatest comeback stories thought in the market right now happening before your eyes. all right. i know what some of you arethinking. six months ago, the stock was at $2. 2.12. since then, doubled. yesterday alone, sprint surged 68 cents for a 20% gain and up nicely, nicely, nicely again today. wouldn’t the prudent thing if you don’t own it, just say i missed it and moved on? you know me, i have no problem with taking something off the table, playing with house money, one of the greatest things, nobody ever got hurt taking a profits, better than a sharp stick in the eye.at $2 and change when people thought sprint would be headedfor bankruptcy, the stock was a trade. now, you know what i think it is an investment, albeit a speculative one. let me tell you y sprint’s ingenious and very tall c represent o dan hessy, maybe the hardest working man in the telco business, has an incredible turn around here and the latest quarter, what is driving the turn around? three main lems. first, late last year, hessy made a deal with apple. see that stock today? get theism phone. now, sprint has the phone people want and it is paying off big time. company sold 1.5 million iphones in the quarter, 40% new customers, new from another chain and much higher percentage than at&t and verizon reeled n second, sprint the only major wireless provider offers unlimited data.this is the hook they need to catch fish, fish willing to pay big fees every month. at&t and verizon will give you unlimited text and talk time but cap your data, which stink furs using a data-hogging smartphone. go over there, charge you an arm and leg. one reason, at&t and verizon saw the gross post paid subscribers shrink in the quarter, sprint added 422,000 subscribe kers and 1.3 across the platform. we are used to verizon and at&t doing better. third piece of the puzzle, danhessy is shutting down the nextel network which sprint acquired in the ill-advised deal in 2005. even as nextel subscribersabandoned, sprint had to maintain the network, a big aren’t stock went to $2. now they are taking down nextel’s antennas, providing subscreeners with faster data service. company should-furnished unwinding next year. sprint has 3 million nextel subscriptions and company working to switch them tosprint. nextel customers went to verizon. hessy has customer marketers, 60% leaving nextel signed one sprint. i heard this almost fell on the floor. thought it would be 25%. these people mostly expensive smartphone contracts. best thing about the move, converting a nextel customer costs $200 less than signing an ordinary customer. how do we know sprint can keepthis up? why do i think this stock is an investment not just in fitpwhich stands for flash in the pan? for starters, we know thewireless business is fantastic. that’s why at&t made a new hightoday, ver rise reason within striking distance of its highs. unlike the big boys, sprint a pure player on wireless, not a land line play. the problem here has been nextel, which they are shutting, and lack of competitiveness, which seems to have been fixed, courtesy othe iphone and unlimited data plans. after these stellar results, clear sprint is playing in the same league as verizon and at&t which means the single-digit stock is on the. are you sprint’s post paid customers they lost in the quarter lowest level ever, down to 1.69%. not a bankrupt company.loews ever. sprint’s average revenue per years important metric in the wireless was the best ever, 63.38, only a buck and a halfbelow at&t’s and $4 more. fourth consecutive quarter whereestimates were met. the ninth consecutive quarter of additions.sprint increased year-over-year. giving you all the facts, this is an investment for you. in other words, this company improving.the turn around finally got the critical mass needed for sprint to totally blow the most bullish estimates. amazing. beginning with this report, sprint now a ton of cash, generated 209 million of free cash flow for the quarte retired $1 billion worth of debtmaturing next year. people thought that wouldn’t happen. i think they will go back to the bond well, get better interest rates, bountiful cash, rates lower. let’s not forget, possibility of sprint tieing with virgin mobile. more competition against at&t and verizon wireless. i think deutsch telecom would like to get the operations that were just left. why would deutsch try to sell toat&t last year? didn’t want to do a deal with them h i don’t like speculating takeerovs, the fundamentals are deteriorating, a combo would be fabulous. finally, sprint is still hated by the analysts. imagine it keeps on delivering like i expect it will, theanalyst will be forced to upgrade the stock like ubs, sprint rallies another 24 cents. bottom line, if the incredible quarter sprint reported, no doubt that dan hessy’s turn sarntd real deal,congratulations, dan. i think the $4 and change stock is headed north of $5. the big inns institutions will be allowed to bite analysts upgrade and to quote neil young, long may she run.steve in connecticut. caller: how are you? not bad, how are you?caller: metro pcs eight months, their first quarter awful, stocks 5.50. second quarter better than expected, rose 40%. even with the investment right now. what should i do? i think that this stock — unlike sprint, a really good quarter but may not be lasting. here is what i want you to do on monday, i want you to raid the

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