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Wachovia Securities has taken a cautious stance on the wireless industry, saying that pricing pressure could hurt earnings before interest, taxes, depreciation and amortization for some companies in the sector.

Analyst Jennifer Fritzsche believes wireless number portability, which is expected to start in November, could make fourth-quarter pricing overly competitive and dampen average revenue per user trends. Wireless number portability, or WNP, will allow mobile customers to keep their number if they change carriers.

Fritzsche isn't sure how WNP will actually affect customer churn rates. However, she said higher marketing and customer retention costs could hit some companies' 2004 EBITDA. Still, she pointed out that most wireless carriers have had a strong start to the third quarter.

The analyst downgraded

Sprint PCS



Triton PCS



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to market perform from outperform.

Fritzsche's favorite names in the wireless market are




Nextel Partners


. Both have outperform ratings.

Shares of Sprint PCS were dropping 23 cents, or 4.5%, to $4.93 recently, while Alltel was down $1.10, or 2.4%, at $44.86. Triton was losing 25 cents to $5.55.