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Sell Sprint, Buy CA Technologies, Trade Alcatel-Lucent

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 - Get Report) 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.

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