Cue the crowing rooster.
Let's start this Monday off right, with a thick slab of positive news from the wireless sector. When it came to a downturn, wireless carriers exhibited a continued ability to rise above the fray lastweek. While
'fessed upto slim possibilities for growth in the second half of 2001 and on into2002,
pleasantly surprised themarket by staying on target.
Friday, wireless carrier Nextel wowed the Street with news that it was still on target to add 500,000 new subscribers in the third quarter. Nextel caters to business customers specifically and in atough corporate spending environment onlookers had been expecting the carrier to run into resistance from thrifty managers. Then again, thesame doubts plagued Nextel in the second quarter, before it managed to turn in strong additions of 485,900 customers. Nextel added thatoperating cash-flow numbers would improve from second-quarter results as well. Investors rewarded these good words with a 5.58% gain to$10.60 in Friday training.
Sprint PCS achieved a similar benefit from
August retail report. The consumer electronics chain offers both Sprint PCSand
service in its stores, with RadioShack sales composing a full 25% of Sprint PCS' new customer adds. Sprint PCS added 843,000 new subscribers in a towering second quarter, a figure analystsexpect it to match in the third quarter. Robertson Stephens responded to the RadioShack news by upping its estimate from 825,000 subscribersto 875,000 new phone callers. Sprint PCS was up less than 1% to $22.76 heading into the weekend.
Nextel added to its positive news by inching closer to better financial health with the appointment of a new CFO, Paul Saleh. Salehheld the same position at
Walt Disney International
, a division of
. Previous CFO John Brittain will remain with thecompany in the treasurer's spot. Somewhat less auspicious, Nextelinformed investors that Standard & Poors had upgraded the company's debt outlook from negative to stable. Find joy in small pleasures. At the end of the second quarter, Nextel stressed that the company hadenough capital to build out its network through 2003.
Nextel is expected to undergo a costly network revamping from its current technology, integrated digital enhanced network, or iDEN, whichis supplied only by Motorola. Onlookers believe Nextel will install a CDMA network, which would carry a hefty price tag. Sprint PCS joined Nextel in the unlucky category of companies in need of fundingto build their networks. Sprint recently sold over $2 billion in shares of PCS stock to keep the company capitalized through 2003. The wirelesscarriers have defied the odds so far in 2001, and it looks like they could be able to add a good third quarter to their fame.