May 22 (Bloomberg) -- NTelos Holdings Corp. shares soared after the mobile-phone company extended a roaming agreement with longtime partner Sprint Corp. through 2022.
NTelos will be able to use Sprint’s wireless airwaves to improve the quality of voice and data services in its coverage area, which includes Virginia and West Virginia, according to a statement today.
NTelos climbed 19 percent to $14.32 at the close in New York, the biggest increase on record. The shares had slumped 40 percent this year through yesterday. The company said today that it will eliminate its dividend after a payment in July, and it lowered its forecast for earnings before interest, tax, depreciation and amortization because of the costs to enhance its network.
“While this move does result in lower Ebitda, we view it as the best possible solution and very much avoiding the doomsday scenario others laid out,” Jennifer Fritzsche, an analyst at Wells Fargo & Co., said today in a note.
Adjusted Ebitda this year will be $128 million to $135 million, down from an earlier forecast of $140 million to $150 million, Waynesboro, Virginia-based NTelos said.
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