NEW YORK (TheStreet) -- Shares of Mobile TeleSystems (MBT) are down 4.6% to $8.09 down after the wireless operator agreed to jointly build and operate faster networks with VimpelCom (VIP) to cut costs amid a plummeting ruble, Bloomberg reports.
The carriers will construct and run 4G networks in 36 Russian territories, aiming to save about a quarter of the required capital spending in the regions, the telecommunications companies told Bloomberg.
Russia is heading to a recession after oil prices fell and the ruble plunged more than 30% against the U.S. dollar and euro this quarter, Bloomberg added.
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Separately, the ruble gained today, hitting the highest levels in two weeks, as Russian authorities ordered major state companies to sell foreign currency to stabilize the market, the Wall Street Journal reports.
TheStreet Ratings team rates MOBILE TELESYSTEMS OJSC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate MOBILE TELESYSTEMS OJSC (MBT) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its expanding profit margins and notable return on equity. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and a generally disappointing performance in the stock itself."