NEW YORK (TheStreet) -- Shares of Sprint Corp. (S) are up 2.36% to $3.90 after Goldman Sachs said it expects "a swifter return to growth," although the bank lowered its estimates for 4Q14 and 2015 as costs to drive this change could pressure EBITDA.
For 4Q14 and 2015, they respectively forecast adjusted EBITDA down to $724 million from $812 million and $5.9 billion from $6.1 billion previously, primarily due to higher customer acquisition costs.
Goldman expects Sprint's postpaid phone net adds to turn positive during the first quarter of 2015, four quarters earlier than previously expected.
"For 4Q14, we estimate 15k net postpaid phone losses, previously -115k, and for 2015, we estimate 507k net postpaid phone adds, previously -243k. The driver of our improved outlook is higher phone gross adds, due principally to elevated churn at AT&T (T) and Verizon Communications (VZ) ," Goldman said.
Some of the churn at competitors is seasonal and related to iPhone contract expirations. However, Goldman analysts believe Sprint's aggressive marketing strategy is exacerbating disconnects at AT&T and Verizon as these two hold the line on price as a preferred alternative to re-pricing their bases in order to hold onto their most value-conscious subscribers.
Analysts, therefore, expect Sprint's combination of "generous" data plans, smartphone leasing and price undercutting to drive a meaningful improvement in Sprint's postpaid phone subscriber share.