This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Sell Sprint, Buy CA Technologies, Trade Alcatel-Lucent

Stocks in this article: SCAALUTVZPCSCSCOJNPRHPQCHLCHACHU

NEW YORK ( TheStreet) - With its constant one step forward and two steps back, Sprint Nextel (S) has become one of those companies that just can't seem to catch a break no matter what it does.

Because of this, I have often felt it to be wise just to stay away from the company. With its earnings release expected Thursday, I think it will be a smart move to play it safe and sell ahead of the report.

Sell Sprint

It goes without saying that in the communications sector dominated by giants AT&T (T) and Verizon (VZ), Sprint continues to exemplify "the little engine that can't," especially considering that it has now fallen to fourth behind MetroPCS (PCS).

Though I remain cautious on Sprint, those with glass-half-full outlooks should be encouraged the company seems to taking some steps in the right direction in hopes of regaining the trust of the market. But the question is, will it pay off?

When discussing Sprint, what continues to catch my attention is it still has negative earnings per share. By contrast, Verizon recently reported a second-quarter profit of $4.29 billion, or 64 cents per share, an increase of 19% from the $3.6 billion it reported in the same period of a year ago.

Not only that, but its revenue grew almost 4% to $28.6 billion, meeting analysts' estimates. The company benefited immensely from rising cellular bills attributable to higher-than-usual data charges. As for this quarter, I'm expecting more of the same from AT&T, which has been considered a safe haven of sorts for a number of years because of its solid market-beating performance.

So what is left for Sprint? Not only are AT&T and Verizon executing to perfection, but new rivals such as MetroPCS are starting to increase market share within the sector. At this point I don't see how Sprint will be able to turn things around absent an acquisition and/or a drastic shift in focus.

Until it can put two consecutive solid quarters together, the stock remains a sell.

Buy CA Technologies

When looking at CA Technologies (CA) the first thing that I notice is the stock started the year at $20 and then reached as high as $28 and has hardly moved ever since. It now sits just under $27 for a gain of almost 30% on the year.

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,461.32 -153.49 -0.92%
S&P 500 1,927.11 -14.17 -0.73%
NASDAQ 4,382.8470 -36.6310 -0.83%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs