Long-Distance Merger Deserves Caution
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I thought this was an interesting post by Forbes about Telecommunication Long Distance businesses. It discusses the possible merger between Sprint Nextel (NYSE: S) and Level 3 Communications (Nasdaq: LVLT) in a joint venture that could lead to a spin-off of their long-distance network businesses.
This is a lofty expectation considering Qwest (NYSE: Q) has struggled to find a buyer for its long distance fiber optic network. Qwest believes this segment is valued at $2B and was hoping bigger players, such as AT&T (NYSE: T) or Verizon (NYSE: VZ) would make a bid, but that did not happen.
However, there is a small chance of hope, as of late. Sprint's stock has been rallying and many financial guru's have buys on this stock. I, however, would never buy Nextel's stock because I do not agree with the quality of their product. How could I when AT&T, Verizon and T-Mobile have much better coverage? The only reason as an investor to buy Sprint would be in hopes for another buy out or merger. Anyways, that is my sole opinion.
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