Sprint Nextel's Bleak Outlook

Sprint Nextel (S Quote) was dealt a blow after a Standard & Poor's analyst said the wireless carrier's credit measures will weaken over the next year due to operational challenges brought on by greater competition and weak subscriber growth.

S&P Rating Services credit analyst Allyn Arden said that while Sprint has made some progress in reducing its exposure to customers affected by subprime problems through the tightening of credit checks, the company's iDEN network, acquired in its 2005 purchase of Nextel, continues to lose high-revenue-generating customers.

Arden added that S&P would consider an outlook revision to negative if Sprint faces further margin pressure due to its inability to moderate subscriber losses and demonstrate improvement on churn. Shares of Sprint Nextel were lately down 47 cents, or 5.4%, to $8.10. The stock is now lower by 38% for the year. ...